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arco
08-07-2004, 12:28 PM
There seems to be some interesting views on this topic, so
perhaps it would be more sensible to separate it from the
gold thread for discussion. I will post a chart when I get the time.

In the meantime heres some interesting info.........

http://www.cooperativeresearch.org/oil/oilcrisis/oilcrisis.html

http://www.cooperativeresearch.org/oil/industry/centralasia.html

donnie
08-07-2004, 12:31 PM
I wont be suprised to see the price of oil hit $80 to $90 in the long term, with all the trouble around the world its a matter of when it hits $80 or $90 mark.

arco
08-07-2004, 12:44 PM
Petroleum Consultant L.F. Ivanhoe said in 1997, “Thus the question is not whether but when the foreseeable permanent oil crunch will occur. This next paralyzing and permanent oil shock will not be solved by any redistribution patterns or by economic cleverness, because it will be a consequence of pending and inexorable depletion of the world's conventional crude oil supply. Few economists can bring themselves to accept that the global oil supply is geologically finite. The global price of oil after the supply crunch should follow the simplest economic law of supply and demand: There will be a major increase in crude oil and all other fuels' prices, accompanied by global hyperinflation, rationing, etc. After the associated economic implosion, many of the world's developed societies may look like today's Russia. The United States may be competing with China for every tanker of oil, with the Persian Gulf oil exporters preferring Chinese rockets to American paper dollars for their oil.” [The Futurist Jan/Feb 1997]

JBmurc
09-07-2004, 08:28 AM
It takes six weeks for VLCCs, used to haul most Middle East crude, to reach the U.S. Gulf Coast. The U.S. used 20.1 million barrels of oil a day in 2003, according to the BP Plc Statistical Review of World Energy. OPEC pumped 29.2 million barrels a day in June, according to Bloomberg data, the highest since October 2000.

Brent crude for August settlement was up 46 cents, or 1.3 percent, at $37.07 a barrel on London's International Petroleum Exchange at 1:22 p.m. Futures gained amid concerns about supply disruptions in Nigeria, Iraq and Russia, where OAO Yukos Oil Co. faces a tax bill that may bankrupt it.

Royal Dutch/Shell Group, Europe's second-largest oil company, is one of about 14 companies and traders looking to book as many as 17 VLCCs to load Middle East oil early next month, brokers said. A phase-out of single-hulled tankers, aimed at reducing the risk of oil spills, is reducing ship supplies.

``The market is going to be heading north, that's for sure,'' Manson said. ``The availability of double-hulled units is pretty scarce so we will see some interesting negotiations.''

yes north thought so ,short term oil 36-40 mid term 38-42 long 50+;)

JBmurc
21-07-2004, 10:34 PM
LONDON - Rising world oil consumption next year is expected to deliver another increase in demand for OPEC crude supplies, the cartel's Vienna secretariat said in a report today, its first forecast for 2005.

The Organization of the Petroleum Exporting Countries said it saw demand for its crude up 340,000 bpd to an average 27.36 million barrels a day, from 27.02 million bpd in 2004, following an increase of 590,000 bpd this year.

The projection may help underpin the view that OPEC should be able to sustain a bull run on world oil prices into a sixth year following the price crash of late 1998 and early 1999.

U.S. oil prices now are back above $41 despite OPEC's efforts to calm markets by opening up the pumps. Traders worry that with production from the cartel now close to full capacity there is little spare to cover disruptions.

World oil demand in 2005 is projected to climb 1.66 million bpd to 82.56 million bpd, up two percent, after unusually sharp growth of 2.1 million bpd, 2.7 percent this year, the report said.

The 2005 demand growth estimate is a little lower than the 1.82 million bpd projected by the International Energy Agency, the Paris-based group that advises industrialised energy consuming nations.

OPEC's forecast for the call on its crude is very close to the IEA's projection of 27.4 million bpd. Both are well below OPEC's latest estimate for its own output of 28.92 million bpd for June, when it said production rose 700,000 bpd from May.

That could mean OPEC considers cutting back production at some point to prevent world oil inventories rising too far.

OPEC late last year and earlier in 2005 cut production because it feared sharp inventory builds. But demand forecasts proved too low and the output cuts helped spur prices to record highs of over $42 for U.S. crude.

Demand for OPEC crude is expected to rise sharply in the remainder of this year from the seasonal low-point of the second quarter. The call on OPEC crude should increase 1.24 million bpd in the fourth quarter to 28.17 million bpd on top of 1.4 million bpd of growth in the third quarter, the report said.

more reasons to invest in oilers;)holding-OSH,BUY,OLX

arco
24-09-2004, 04:32 PM
The bearish Butterfly pattern has a high probabiity score,
so in the next few days we will see if it is the case this time.

The target reversal area would be $49-51.

http://www.tacticaltrader.com/attachments/09172004.gif

NB. This chart shows the Gartley Butterfly set-up
and is a few days old with the current price closing
near the $48 overnight.

donnie
06-10-2004, 09:17 AM
past the $51 mark only $30 to go before it hits $80

arco
05-11-2004, 11:08 AM
Interesting chart from Chartoftheday.com
showing inflation related oil price.

http://www.chartoftheday.com/20041006.gif

mark100
05-11-2004, 01:15 PM
Interesting site
www.lifeaftertheoilcrash.net

cheers
mark

Mick100
06-11-2004, 02:29 PM
Interveiw with Matt Savinar on FSO

The FSO team have been talking about oil peak for 2-3 years now


http://www.financialsense.com/Experts/2004/Savinar.html

Mick100
20-11-2004, 11:39 AM
Today's WrapUp by Jim Willie CB 11.18.2004 Mon Tue Wed Thu Fri Archive


PUTIN SHAKES THE PETRO-DOLLAR REGIME

Subtle changes are in the wind on the energy front. As much as some people want to regard Russia as a strong American ally, their behavior on several fronts testifies to the contrary. Some truly staggering developments are underway, not adequately reported. Behind the scenes, covered little by the intrepid US press & media, a meeting was convened two weeks ago in the Urals of Russia. European leaders, and OPEC representatives, and Putin quietly are plotting to establish stronger ties between Europe and Russia in their basis for financial transactions. Putin is adroitly offering to install euro pricing of crude oil, which would surely favor Germany and other large EU nations. He strives to obtain geopolitical concessions from EU leaders, namely a more powerful voice for Russia in world politics.

OPEC appears to be willing and eager to join in new alliances to undermine the US domination from owning the world reserve currency. Enormous consequences follow, which lie completely in US blind spots. A strange contrasting parallel might exist between the United States and Russia, regarding relationships with large energy companies. The USA has evolved into a cooperative collusion with big companies like Halliburton. Russia has broken down into a confrontational situation steeped in confiscation with big companies like Yukos. The USA seems to work constructively with large firms, with governmental support. This is seen in sponsored foreign grain sales, in development of petro-chemical plants, in defense contracts for the military complex, in permissiveness toward software monopolies, in protection of the steel industry, and elsewhere. Russia seems to work in adversarial roles to steal back and forth with their big firms.

RUSSIAN ASSAULT ON FREE ENTERPRISE

Russian legal treachery embodies a big insult to free enterprise and rights to property. One might say Yukos Oil began as a company with stolen property, or cozy deals to gather in several purchases from state-owned regions, or tax scoffs at Russian authorities enabled growth. Fine, whatever. My attention is trained on current methods, which can be aptly labeled as legal warfare, and trends which betray private property. The Yukos tax & fine bill submitted was revealed to be $18.5 billion, which exceeds the company’s annual revenue, and goes far beyond the level where embarrassment is profoundly clear. The Russian government has established a modus operandi, i.e. method of operation. A company is targeted for seizure. It is charged with tax evasion. Their assets are then frozen, pending investigations and legal outcomes. Cash flow is interrupted, only to put debt service repayments in jeopardy. The courts declare debt default, a fresh new problem for the targeted company, whose stock declines in value, and possibly sharply. Under financial duress, a deal is cut, as taxes are paid as a fraction of the original demand in return for a sale of large tracts of the company’s properties to the Russian govt. Charges are reduced or negotiated along with the distress sale of their property. Such a pattern has shown itself clearly with the Yukos case.

Moreover on the front tied to cooperative agreements, Russia’s treachery is wholly evident in its dealings with western firms. Pan Am Silver was severely victimized, via dissolution of a partner firm and reconstitution of a new corporate entity Polimetall with those mining rights, leaving the US firm out in the cold Siberian winter. PanAm Silver appears not to be in line to share profits where silver production is forthcoming. The original company was dissolved, and along with it, all contracts with PanAm. Czarist gamesmanship with western energy companies is now in focus. British Petroleum is at risk with older contracts, while others like Conoco Philips are at risk with newer contracts. British Petroleum could be in the midst of a bold double-cross, for the craziest of sounding reasons. They exce

Packersoldkidney
03-09-2005, 03:12 PM
Oil prices look to be undergoing a blow off top.

Mick100
03-09-2005, 03:17 PM
That's what I'm thinking Packers

I expect the price to go back down to the low 50's over the next couple of months

,

Packersoldkidney
03-09-2005, 03:26 PM
Hey, Mick.

I think if this scenario happens it will affect most energy stocks in the short term: overall it could be a good thing for sharemarkets, however.

arco
03-09-2005, 04:36 PM
Hi POK

The charts are hard to interpret at the moment,
but I will keep a watch for signs of butterflies.

I did notice this article if its of any interest.

http://www.safehaven.com/article-3712.htm

arco

Packersoldkidney
03-09-2005, 04:57 PM
Cheers, Arco.

ASXIOU
03-09-2005, 06:46 PM
Oil to drop to $US35 next year: Forbes
http://smh.com.au/articles/2005/08/30/1125302549456.html

BHP Billiton CEO expects oil to fall
http://smh.com.au/articles/2005/08/31/1125302608530.html

Seems the 'smart money'[?] on this one is forecasting a fall. Personally I have no idea and don't try and forecast future commodity prices in the short term as there are too many outside unknown factors but one thing that cannot be denied and can be quantified is that demand is outstripping supply. I would prefer to take a 'random walk' on this and feel it could go either way :)

Mick100
03-09-2005, 07:14 PM
quote:Originally posted by Long Strangle


quote:Originally posted by Mick100


That's what I'm thinking Packers

I expect the price to go back down to the low 50's over the next couple of months

,


Absolutely on way this is going back down to the low 50s this year or next. All date points to it holding current highs, and possible making further highs. Would love to see some research behind your statement.



I should add that medium/long term i think oil is heading higher but short term I expect a pullback

Have you heard of the oil indicator? (stephen Leeb)
It shows that,in the past, if oil rises in price by 80% or more in a 12 month period the result will be a world wide reccession which in turn leads to a drop in demand for oil and thus, lower prices.
Oil is up over 60% in the last 12 months so it's time to be cautious in my opinion. If oil goes much higher in this run-up I will concider bailing out of my oilers. I hope that I'm right and oil pulls back in price short term.

,

diesel
04-09-2005, 01:39 PM
I have just finished reading Matthew Simmons book "twilight in the desert" and would recommend it as required reading to all those interested or invested in the oil sector.

It raises a number of questions as to the ability of Saudi Arabia to meet oil demand going forward as well as the high probability that we are close to these fields peaking out.

I would rate this book 10/10.

Mick100
14-09-2005, 03:33 PM
Oil below $63 as high prices crimp demand
Mon Sep 12, 2005 11:40 AM ET
Printer Friendly | Email Article | Reprints

By Peg Mackey
LONDON (Reuters) - Oil prices slumped below $63 a barrel on Monday as signs of a slowdown in global petroleum demand growth countered the struggle to restart U.S. oil facilities after Hurricane Katrina.

U.S. crude was off $1.23 at $62.85 a barrel. Crude is now $8 below the record high of $70.85 struck on August 30. London Brent crude slipped $1.24 to $61.60.

Forecasts are that Katrina's destruction could shave 0.5 to 1.0 percentage points off U.S. economic growth in the fourth quarter, further undermining fuel demand just as high prices hit consumption.

"For the first time, traders have to worry about demand," said Gary Ross, chief executive of U.S. energy consultancy PIRA Energy.

"There's no doubt there is evidence of demand destruction emerging everywhere. U.S. gasoline data over the next few weeks will show the effect of high oil prices on demand."

High prices are also eating into Asian oil consumption growth. The International Energy Agency last week has cut its projection for China growth this year by 100,000 bpd to 220,000 bpd. Traders are seeking to move surplus petroleum products from Asia to Atlantic Basin markets.

China's annual consumer price inflation unexpectedly slowed to 1.3 percent in August from 1.8 percent in July, the National Bureau of Statistics said on Monday. The figure was the lowest since September 2003.

The IEA last week revised down its forecast for world oil demand growth this year by 250,000 bpd to 1.35 million bpd, compared to 2.9 million bpd last year.

Mick100
29-09-2005, 06:44 AM
Arco

What are your thoughts on oil ATM

I heard someone talking about a head and shoulder pattern forming a few days ago

cheers
,

arco
29-09-2005, 02:58 PM
Mick

Yes there is a possible H&S in the making but the price would have to break circa 63.30 and test that polarity change before it could be confirmed.

Should that scenario play out oil could drop to between $53-57, but a reversal north at that point could be bullish again because it would complete a Gartley pattern.

arco


http://futures.tradingcharts.com/charts/cdl/COB5.GIF

bermuda
29-09-2005, 04:08 PM
Arco,
The following major issues are affecting the price of crude oil

1.Increasing demand versus struggling supply.The supply gap is now down to 1 million bbls per day on a 84 million per day usage.There used to be a gap of 5 million bbls per day.

2.Iraq has had its oil infrastructure decimated and is without a plan to return production to former levels.

3.Non Opec oil supplies have peaked and are now diminishing.e.g North Sea Oil is in a 10% decline as is Prudhoe Bay in Alaska.And turning to gas there will be huge problems for the UK this winter.Terrible planning has reduced gas supplies to 5 days.(Heads will roll believe me)

4.There is unrest in Nigeria which currently produces about 2.5 million bbls per day.

5.There is huge and growing demand for light sweet crude.Even Saudi Arabia admit light sweet crude peaked in 2000

6.There is insufficient refinery capacity especially in the USA to meet demand.The US havent built a new refinery for 30 years.

7.Opec members are still refusing to supply accurate data on their reserves...,especially the largest producer Saudi Arabia.Many,including such authorities as Matthew Simmons believe their reserves are vastly overstated and that some of their major fields are in decline already.

8.The Saud Royal Family are under increasing pressure from Islamists to oust Westerners.Once this happens look out.Oil could easily go to $200/bbl overnight.

9.Iran is under new leadership and already is picking a fight with the USA.Not only with respect to restarting their Nuclear programme but also they plan to convert their oil trade to Euros next March.Saddam Hussein tried the same thing and got invaded 3 months later.

10.China and India are increasing thir oil consumption at up to 20% per annum.Each day China puts another 10,000 cars on the road.China has actively been out sourcing oil from Iran and Venezuela and elsewhere.In fact they put in a bid for a large American oil company .

11.Changing weather patterns have brought and wrought havoc to the Rigs
and refineries in the Gulf of Mexico.

Better stop now.I am a real joy germ eh?

What part of Bermuda are you from?

Mick100
29-09-2005, 04:28 PM
Bermuda, arco is referring to the short term
This is also what I am interesrd in ATM
Med/long term I am bullish on oil for many of the reasons you mention plus some.
,

arco
29-09-2005, 06:20 PM
Hi Bermuda

My post was basically regarding the possibility of a Head and Shoulders that Mick mentioned.

The H&S pattern is not confirmed as yet, but I gave the likely scenario if it should eventuate.

Anyone interested can read about these patterns here.....

http://www.chartpatterns.com/invtdheadandshoulderschrts.htm

arco

Packersoldkidney
29-09-2005, 06:30 PM
Nice to see the Bermudans sticking together. Hope this hurricane season was nice for you: another hurricane or three might turn the head and shoulders into a shoulder, a head and goitre with a mean elevation of 88 degrees.

Krustytheclown
29-09-2005, 06:38 PM
Interesting oil debate you guys have going.

All the true and forboding points you covered Bermuda...(very well summarised!) are a great reason to remain well invested in Oil and GAS.....Iran/Saudi are major potential flashpoints that I would expect to play out over the next two years....

Anyone have any "soon to produce" Aussie juniour oilers with gas interests in the USA...other than Neo/Opl/Azz???
US gas price is forcast by some to reach US$16-20 MCF by Xmas.

G.

Mick100
29-09-2005, 06:45 PM
GREGOR

FAR is worth a look - very good drilling program
VPE is making good headway in the US
I also hold PSA which has been increasing production at a good rate over yhe past couple of yrs
,

Packersoldkidney
29-09-2005, 06:47 PM
STX is about to drill for gas starting next month I'm led to believe, Gregor. There are a heap of them, FAR, NWE....shysa, can only come up with two but there are defo more. Planet Gas is one, think its PGS. Pacrim I think (PRE), LOU is another. Can't think of anymore.

Packersoldkidney
29-09-2005, 06:48 PM
Yes Petsec is a cracker, Mick. Well done for getting aboard.

bermuda
29-09-2005, 06:52 PM
Arco,
I was born in Hamilton.Where are you domiciled?

Ps. I wouldn't like to guess where oil will go.Methinks down to about $US50 but anything could happen.

nelehdine
29-09-2005, 07:47 PM
Gregorious , Amadeus Energy is solely US production based. Approx 400k bbl of oil will be produced in its 05/06 year and 200k BOE worth of gas ( up 350% !!! from 04/05 ) They are totally unhedged and have some great onshore acreage in Texas and Louisiana. 155m shares on issue and will probably earn A$25m if oil averages $55 and gas $7.50 ... extremely conservative. Also own 31.73% of Australian Renewable Fuels which is worth approx 35c per AMU share. Current price is $1.10 so O&G assets valued at 75c/share so they are on a forcast P/E of about 4.5 ... great value. www.amadeusenergy.com

Disc: hold 81,250 AMU

Krustytheclown
29-09-2005, 10:03 PM
Thanks...Youll!

Not selling the Neo's yet.....but some of the suggestions sound interesting..

G.

arco
14-10-2005, 08:38 AM
Updating the chart. We could see a move down to the uptrend line IMO.

http://www.khalsaspad.com/files/101305_136.gif

arco

Packersoldkidney
14-10-2005, 10:48 AM
Nice bat.

arco
14-10-2005, 11:39 AM
Packers

Its actually a Gartley that could just turn into a beautiful Butterfly.

arco

Packersoldkidney
14-10-2005, 12:41 PM
A bullish gartley: sometime ago I downloaded and printed an excellent 134 page 'manual' on Fibs, chart swing points and gartleys. I've just had a google for it, but can't find it: it's a PDF I think. I do have the hardcopy sitting on my desk, but haven't gotten around to reading it as yet. Could have been written by Arco himself. :)

Mick100
20-10-2005, 06:38 PM
Reuters
Oil drops as crude piles up
Wednesday October 19, 11:21 am ET
By Peg Mackey and Barbara Lewis


LONDON (Reuters) - Oil dropped on Wednesday after U.S. data showed crude and gasoline piling up in storage tanks and consumers cutting down on fuel use.
Adding pressure to prices, Hurricane Wilma appeared to steer away from vulnerable rigs and refineries in the Gulf of Mexico.


U.S. crude (CLc1) was down $1.15 to $62.05 by 1515 GMT, after losses of $1.16 on Tuesday. London Brent crude (LCOc1) was off 79 cents at $58.49.

Prices reversed slim gains after weekly U.S. government data showed crude stocks rising by 5.6 million barrels, sharply up on a forecast build of two million barrels.

Gasoline rose by nearly three million barrels against expectations of a 1.2 million barrel draw, though distillates, which include heating oil, declined by 1.9 million barrels -- nearly matching expectations.

Adding to the bearish impact of the stocks data, the U.S. government's Energy Information Administration provided the latest evidence that high prices have eroded demand.

It said demand for oil product was down 3.2 percent from a year ago.

Analysts said Wednesday's data were very bearish. But they said the full impact on inventory levels from hurricanes Katrina and Rita that struck oil infrastructure in August and September had yet to be seen.

"We're still dealing with trying to guess what the hurricanes' impact was on oil facilities," said Bill O'Grady of A.G. Edwards in St. Louis.

"Normally we base our forecasts on seasonal patterns, now seasonal patterns are disrupted."

U.S. refineries are gradually resuming normal operations after the storms. Five plants were still shut along with two thirds of Gulf of Mexico oil output.

Adding to the build-up in crude stocks as refineries stay idled, OPEC has been pumping at near full tilt.

The cartel expects to boost its production capacity to 38 million bpd by 2010 from 32.5 million bpd this year, its acting Secretary General Adnan Shihab Eldin said.

Tensions with OPEC's second biggest producer Iran mounted. Diplomatic and industry sources said Iran was blocking British and South Korean goods in an apparent attempt to force the two to drop their opposition to Tehran's nuclear program.

Oil and gas exports have not been affected.

yogi-in-oz
21-10-2005, 07:31 PM
:)

Hi folks,

Some astroanalysis on oil and the DOW, at:

http://www.incrediblecharts.com/forums/messages/6/369432.html

... and some thoughts on sector rotation, as well.

have a great weekend

yogi

:)

Mick100
26-11-2005, 02:29 PM
Kuwait's biggest field starts to run out of oil


By Peter J. Cooper
KUWAIT: It was an incredible revelation last week that the second largest oil field in the world is exhausted and past its peak output. Yet that is what the Kuwait Oil Company revealed about its Burgan field. The peak output of the Burgan oil field will now be around 1.7 million barrels per day, and not the two million barrels per day forecast for the rest of the field's 30 to 40 years of life, Chairman Farouk Al-Zanki told Bloomberg. He said that engineers had tried to maintain 1.9 million barrels per day but that 1.7 million is the optimum rate. Kuwait will now spend some $3 million a year for the next year to boost output and exports from other fields.

However, it is surely a landmark moment when the world's second largest oil field begins to run dry. For Burgan has been pumping oil for almost 60 years and accounts for more than half of Kuwait's proven oil reserves. This is also not what forecasters are currently assuming.
Last week the International Energy Agency's report said output from the Greater Burgan area will be 1.64 million barrels a day in 2020 and 1.53 million barrels per day in 2030. Is this now a realistic scenario?
The news about the Burgan oil field also lends credence to the controversial opinions of investment banker and geologist Matthew Simmons. His book 'Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy' claims that ageing Saudi oil fields also face serious production falls.
The implications for the global economy are indeed serious. If the world oil supply begins to run dry then the upward pressure on oil prices will be inexorable. For the oil producers this will come as a compensation for declining output, and cushion them against an economic collapse.
However, the oil consumers then face a major energy crisis. Industrialized economies are still far too dependent on oil. And the pricing mechanism of declining oil reserves will press them into further diversification of energy supplies, particularly nuclear, wind and solar power.
All this was foreshadowed in the energy crisis of the late 1970s when a serious inflection in oil supply by the year 2000 was clearly forecast. How ironic that those earlier forecasts now look correct, while more modern and recent forecasts begin to look over optimistic and out-of-date with geological reality.
Nobody can change the geology, and forces of nature that laid down reserves of oil and gas over millions and millions of years. Could it be that we have been blinded by technological advances into thinking that there is some way to beat nature?
The natural world has an uncanny ability to hit back at the arrogance of man, and perhaps a reassessment of reality at this point is called for, rather than a reliance on oil statistics that may owe more to political manoeuvring than geological facts. - AME Info FZ LLC.

Krustytheclown
26-11-2005, 02:42 PM
Let us be happy that NZO/PPP and other Aussie-NZ oilers will be in full scale production for the years ahead when this oil crunch bites.
Shareholders in the likes of those will be rewarded and still able to fill their tanks!

Natural Gas in the USA is also the place to be .....cheap gas there is now a memory IMHO.

Thanks MICK for these links!
Neo are in for a good Dec' testing round I forsee.....

G.

Mick100
01-12-2005, 07:29 PM
South Asia
Dec 1, 2005



The foundations for an Asian oil and gas grid
By Siddharth Srivastava

NEW DELHI - Stung by the rising international price of oil and domestic shortages coupled with high requirements of a growing economy, India has revived a plan for an oil and gas grid for the Asian continent.

The grid is part of a two-fold strategy by the two top Asian oil guzzlers, China and India, to ensure reliable delivery networks and energy security. The other element involves acquiring stakes in production and exploration projects for which New Delhi and Beijing continue to cooperate as well as compete.

The emphasis on the grid comes in wake of reports that India and China, the most aggressive shoppers for oil and gas assets in the world, are coming together to put in a joint bid. The China National



Petroleum Corporation (CNPC) and the Oil & Natural Gas Corporation (ONGC), two of the most high-profile emerging global oil companies in the past year, could jointly bid for Petro-Canada's $1-billion oil and gas fields in Syria. Both India and China feel the strategic need to diversify their energy sources from the current dependence on West Asia.

Asia is no longer marginal to the global oil and gas economy, said India's Petroleum Minister Mani Shankar Aiyar in his inaugural address at the ministerial round table on cooperation between North and Central Asian producers in New Delhi last week.

"The era when our production was controlled by others is now behind us, the era when the bulk of consumers lived in other continents is also over," he said. "Already, two-thirds of the oil extracted from the bowels of West Asia and Southeast Asia finds its way to the markets of Turkey, India, China, Korea, Japan and other consumption centers in Asia."

The round table, the second being hosted by India, has brought together oil-producing countries including Russia, Turkey, Uzbekistan, Kazakhstan and Azerbaijan in dialogue with the principal Asian consumer nations - China, Japan, Korea and India.
This is not the first time India has raised such a proposal. At an Asian gas-buyers meeting in New Delhi in February, Aiyar exhorted assembled nations, including China and Saudi Arabia, to build a pan-Asian gas grid and end "the wretched Western dominance".

Reiterating India's resolve, he said producers and consumers could jointly invest in infrastructure to gain energy security for the region. "We can together invest in exploration, production, transportation, shipbuilding and shipping, in ports and terminals. We can together build refineries and gas-processing plants and power-generation stations and petrochemical units; in short, we can together take on the world. That would be true energy security."

South Korea, Asia's fourth-largest oil consumer, has backed India's efforts to create an Asian oil and gas order by setting up an inter-state oil and gas-transportation system.

"Trade in oil within Asia remains marginal," Korean Minister of Commerce, Industry and Energy Hee Beem Lee said. "The work that is urgently needed is a master plan that links all the points in Asia through what can be called, the Inter-Asia Oil and Gas Transportation System.

"To solidify this effort, I propose that a working group be established with all the countries in Asia represented, and its first meeting be held in the first half of next year in Korea. North and Central Asia, which includes Russia and the Caspian Sea region, were increasingly important to global oil supply. Large oil fields with pipelines are being developed, and with it Central Asia is emerging as a major oil resource region. But the unresolved problem of transporting the oil is holding back the full potential of oil trade within Asia."

Meanwhile, Aiyar said a Japanese proposal to study the possibility of networking the countries of Central, South and East Asia and elsewhere as well as an initiative to promote a sustainable and flexible energy system (SAFE) were endorsed. It was agreed that practical steps be taken bilaterally and

Packersoldkidney
15-03-2006, 10:15 PM
I found this post on another forum, and thought it would be pertinent to here:

http://www.princeton.edu/hubbert/current-events.html

Long. While some people might call into question the assertion that oil is a non-renewable resource, I have yet to hear from anybody that oil is NOT scarce and EXPENSIVE to produce.

a) So, the age old question: How long 'till we run out of the goey stuff? This might be as good an estimate as any:
http://www.rigzone.com/news/article.asp?a_id=15186

Let's say that they're dead wrong, and underestimated field capacity and the improvement of extraction technology in the next 10-20 years and so we can double the amount of oil reserves we can get our hands on from 1.3 trillion to 2.6 trillion barrels. Let's also assume that oil demand does not remain constant but, in fact, drops about 20% from current levels (unlikely but possible), so from 76 billion barrels a year down to 60 billion barrels a year, call it what you may, conservation, limits in price elasticity, recession, taxes, alternative energy technologies.
http://www.scaruffi.com/politics/oil.html

That's about 40 years worth of oil and yet, this is a very rosy scenario.

b) Canada. Probably on one of the few upsides in oil production this 2006, i believe the closest new production facilities are 12-18 months away. I don't think deriving oil from kerogen will cost $3.50 or even $7.00 USD per barrel, do you? 4 million additional barrels of oil every day, makes 1.44 billion barrels a year. Up from 60 billion a year does not make for even a 2.5% increase in production, estimating it at a 30% recovery rate. Maybe it will buy us 2 years in the long run.
http://www.rigzone.com/news/article.asp?a_id=29285
http://www.thebulletin.org/article.php?art_ofn=mj05cavallo

c) Latin America. The largely ignored component of Bush's foreign policy, the region has -and will continue- to fall victim to caudillo politics.

Think Chavez is a pain in the ass? Wait until Andres Manuel Lopez Obrador's -AMLO for short- is elected to the Mexico presidency. Too close to Castro and Chavez for comfort, they're likely to become the 'terrible trio' of the region and a major sore for US foreign policy. It does not help that the US embassador to Mexico is often caught saying unpopular things in Mexico in an election year. A savvy politician, AMLO is the lead candidate telling the US to but out of Mexican internal affairs, appealing to a nationalistic resurgence similar to that of Venezuela.

Also deeply worrying is that Cantarell, Mexico's biggest and the world's second largest oil field declined 6% production in 2005 and probably will drop another 5-6% this year also. PEMEX, Mexico's state-owned oil enterprise, has 130k employees and a burdensome pension plan for retirees. The union weights in heavily and is politically connected so for any reform, is DOA. It also levies an astounding tax rate of and is the primary source of revenue for the country at an estimated $25 billion USD, larger than remittances from Mexicans abroad, foreign direct investment and tax revenues -in that order-. This adds to decades of nearly zero investment in oil infrastructure and general neglect and corruption in PEMEX.
http://www.rigzone.com/news/article.asp?a_id=29314

Hugo Chavez has little incentive to scale back oil production from Venezuela's state-owned oil giant PDVSA , but if you remember correctly, 2 years ago he was almost thrown out of power when he fired the company's senior management for not 'towing the line'. Think that expertise can be replaced overnight? Think that it does not impact oil production? Think again.
http://www.stratfor.com/products/premium/read_article.php?id=248553

Overexplotation, lack of renewed investment and maintenance,
corruption, and use of the oil monopoly as the union and politicos piggy bank are all too common in both Venezuela and Mexico.

d) Africa. Unrest in Nigeria, D.R. of Congo and Ecuatorial Guinea will exacerbate as more US and European oil companies begin drilling for new oil reserves. Widespread government corru

Packersoldkidney
07-06-2006, 04:38 PM
"Saudi Arabia's oil minister confirmed that his country's massive crude-oil output has declined in recent months, but he attributed the trend to a drop in demand…. In an interview… Ali Naimi said other [OPEC] cartel members are having trouble finding buyers for all the crude they are producing, at a time when global stores are near full… 'It's not just heavy oil. Even light oil is having problems finding buyers,' Mr. Naimi said, referring to premium grades of crude known as light crude that are highly prized by refiners because they have high gasoline yields. Asked if the kingdom was easing up on supply because of concern about the buildup of inventories in the U.S. and other importing countries, Mr. Naimi rejected such a motive, replying: 'At $70 a barrel?'"

Apparently oil stocks are at 10 year highs in many places, including the United States. The question is, why is oil still at $70 a barrel?

Packersoldkidney
07-06-2006, 07:03 PM
By the way, when I wrote "oil stocks" I did not mean companies that are oil focused, I meant inventories of oil. The storage of oil is at decade-long highs, that is what I meant.

I wonder what an economist like Skinny would make of this? Pity he doesn't post so much anymore.

Mick100
07-06-2006, 07:22 PM
I'v also heard that oil inventories are at all time highs in a few countries including the US.
What you should be asking yourself is why are some counties carrying higher inventories than ever before. I can think of a few good reasons off the top of my head why they are doing this:
Nigeria
Venezuela
Iraq
Iran
Russia

If you need an economist to explain to you why oil is at $72 per bbl you really are missing the big picture here packers.
Oil may go down to $65 but I think it's much more likely to go over $80 in the near term
.

Packersoldkidney
07-06-2006, 07:25 PM
Fair enough, Mick: supply and demand would certainly indicate as much.

Mick100
07-06-2006, 07:52 PM
I don't know exactly how much of a fear premium there is in the price of a barrel of oil at the moment but it's probanly around 10-15 dollars/bbl
When, or if, this fear premium comes off the price of oil then you can, again, base the expected price on supply/demand

Are global tensions declining at the moment?
Not from what I'm reading/watching /hearing
.

Packersoldkidney
07-06-2006, 08:50 PM
The problem is with what you are reading/watching/hearing, Mick is that the global mass media will give you the worst case scenario, because that is what sells their product.

I suspect that a fair premium is already built into the price of oil and gas: the same speculative forces have been at play with gold, silver and the base metals in recent months.

To be honest I do think demand is still very high in historical terms for O & G across the globe: the problem is that speculative forces have been at play in the O & G market. I can't see O & G going down to where it was in 1998, but then I can't see speculative forces driving it much higher, neither.

Obviously your opinion is different, and that's fine with me.

skinny
07-06-2006, 08:56 PM
quote:Originally posted by Packersoldkidney

By the way, when I wrote "oil stocks" I did not mean companies that are oil focused, I meant inventories of oil. The storage of oil is at decade-long highs, that is what I meant.

I wonder what an economist like Skinny would make of this? Pity he doesn't post so much anymore.


Hi Packers, ok, my 2c...

Traditionally, when inventories built up oil prices would decline. In this sense current spot oil prices look overvalued. Another indicator of prices looking excessive is that the ratio of oil prices (NYMEX) to natural gas (Henry Hub) has blown out well beyond historical norms; and in the medium run there is a fair degree of substitution between these energy sources in the US for industrial users at least. There are several arguments you can run though to support current prices:

1) Present spot prices are more focused on the tight current and projected world demand/supply balance than inventories. Supporting this argument is the futures strip - at the start of the increase in oil prices in '02 it barely budged, and only reluctantly followed up spot prices for a couple of years. Roughly around a year ago we saw the strip rapidly increase as the market became increasingly convinced about the persistence of the tight world demand/supply situation. And relatedly, that the doom mongers saying that the increase in oil prices would collapse economic growth and cause inflation to take off were wrong. World economic growth in '05 was strongest in roughly 30 years and inflation so far has been pretty well contained.


2) From an economic point of view when there is not much spare capacity and there are reasonable concerns about supply disruptions (read Iran, Latin America, etc) it makes sense to build inventories (or buffer stocks). In addition, we know that China, the US and others have been building stocks for political reasons.

3) The increase in supply coming on stream over the next few years is mainly from production sources that have much higher marginal costs (e.g. deep offshore wells and oil sands). Again the futures strip supports this one.

4) The price of crude is not just how much it costs to get the stuff out of the ground or sea or whatever; it also reflects the cost of shipping to markets. Global capacity shortages in shipping (VLCCs) enabled companies like FRO (worlds largest publicly listed crude carrier) to absolutely cream it over the past few years. The chart makes you weep:
http://finance.yahoo.com/q/bc?s=FRO&t=5y

However, arguably this one will become less important over the next few years - FRO has been sold off this year given expectations that more ships will come on line and now sells on a historic P/E of a touch under 4!



On the other hand the number 1 rule of markets is that they always overshoot and we know speculative interest in oil has been steadily building over the past few years. My long run *guess* is that prices will come back to the marginal costs of extracting oil from tar sands (so around US $35 per barrel) as reserves here are thought to be (1) massive and (2) in a politically stable first world economy (Canada).

Could be a few years yet before we see it though - I am mainly cashed up but the few stocks I do hold are still largely resource based ones!
Should also say that the cash I hold is Canadian dollars - have has a fanastic run on that!!

Packersoldkidney
07-06-2006, 09:01 PM
Thanks for the detailed reply, Skinny: superbly argued for an internet forum or indeed for anywhere else. I'm glad your focus is making money out of the Canucks and not us Aussies as I think we'd walk away lighter of pocket out of the exercise.

Halebop
07-06-2006, 09:09 PM
I'm with the Kidney on this Skinny, nice analysis! I disagree with him on one issue though - feel free to fleece the Aussies!

Packersoldkidney
07-06-2006, 09:12 PM
Hey, Hale, we can't compete at the moment by buying all the Pacific islanders and South Africans we have now in the Wallaby setup. How are we going to compete if you take our money away from us and we have to rely on homegrown talent?

Cooper
08-06-2006, 07:25 AM
quote:Originally posted by skinny
my 2c...



Only 2c? Bargain!

ASXIOU
10-06-2006, 06:59 PM
http://money.cnn.com/magazines/fortune/fortune_archive/2006/05/29/8378002/

interesting article on oil

bermuda
10-06-2006, 09:24 PM
Saudi main oil fields are now declining at over 2 % per annum.It's official.

Packersoldkidney
11-06-2006, 12:32 PM
quote:Originally posted by bermuda

Saudi main oil fields are now declining at over 2 % per annum.It's official.


That has been happening for some years, you'd think.

Mick100
11-06-2006, 12:59 PM
quote:Originally posted by bermuda

Saudi main oil fields are now declining at over 2 % per annum.It's official.


Thanks bermuda

I have heard from a credible source that the old giant feilds of Saudi Arabia are decling at a rate of 8% per yr

http://www.netcastdaily.com/fsnewshour.htm

go to the 39th minute of the first hour to listen

,

clearasmud
11-06-2006, 01:09 PM
As investors we have little to worry about a collapse in the oil price as opec now has the power to manage the oil price and I believe $60-$65 is their target.

We have noticed all our shares shot to pieces because of $70 oil and to a lessor extent $3 copper etc.This is of course because of inflation and recession fears

So oil will fall back into the range and everybody will be happy for the time being.

airedale
11-06-2006, 02:09 PM
Hi Mick et al, Yesterday's Press reports that Alan Bollard and the Reserve Bank are forecasting a US$ 20 fall over the next two years back to US$50. The whole tone of the article is so soooothing-don't worry everything will be fine.
I tend to believe Matthew Simmons instead.

Packersoldkidney
11-06-2006, 02:33 PM
I'm going against the crowd here, and I think sub - $50 a barrel is defo on the cards in the not too distant future. I know Mick for one thinks the opposite, but this is not a competition over who's right and who's wrong, it's a forum for debate on topics like oil.

One of the main reasons why I think oil is in for a downwards revaluation is because oil at $70 + is now counted as a 'sure thing': that in particular is something to be extremely wary of.

There is a lot of speculative money in oil: if there is a recession or a slowdown coming along, then when that money unwinds from oil, then it will unwind in a fairly dramatic fashion.

Long term the prospects for oil are bright, short to medium term I'm not so sure.

Mick100
11-06-2006, 02:59 PM
quote:Originally posted by Packersoldkidney
[

Long term the prospects for oil are bright, short to medium term I'm not so sure.


I agree 100%
And therein lies the difference between the way you and I veiw things.
I'm thinking about what's going to happen over the next five yrs and you're thinking about what may happen in the next fives weeks or months. I have never made a secret of the fact that I invest for the long term and you make no secret that most of your trading activity is very short term. I'm not at all surprised that we see things differently.
.

Packersoldkidney
11-06-2006, 03:05 PM
Yep, that sums it up Mick....just so long as we both walk away winners from the situation!

Mick100
11-06-2006, 03:16 PM
One more thing I should say is that I do have shortterm veiws but the probability of my short term veiws being correct is only about 50/50 like many others I think. On the other hand I think the probability of my long term veiws being correct is maybe 85%. So I put my money on my long term beliefs and although I don't ignore the short term, it dosen't have a big impact on my investing decisions.
.

bermuda
11-06-2006, 04:01 PM
Mick100
I have read Twilight in the Desert by Matt Simmons several times and met him at the NZ Petroleum Conference earlier in the year.I have asked him to do a lecture in Christchurch NZ next year which he has offered to do for a nil Honorarium.Whether he can make it depends on a lot of factors but I am hopeful.All we have to do is meet his airfares and accommodation and we have the budget for that.

Anyway, his book is extremely credible and is not written in a defensive manner.He has done the research over many years and now employs over 150 people who are turning up some invaluable information about the oil industry

A while ago a Senior Kuwait hydrology expert told Simmons that he was worried that the Wasia aquifer might be close to depletion.If so this will have awful implications for efforts to sustain not just Saudia Arabia'a Northern fields but also the Nuetral zone and Kuwait's Burgan field.......Since then we have now been advised ( about 6 months ago ..and AFTER Twilight in the Desert was published ) that the Burgan field is now in decline.There are plenty of such examples of serious Saudi depletion and whilst we may now 'enjoy' a supply cushion of about 1.3 million barrels per day , if the Saudi fields cant keep up with rising demand then the price of oil must go up.

I agree that the current price is overheated and it could come back to $US 50/bbl but only if the following factors are resolved peacefully
1. Iran standoff approx $7 premium
2. Nigerian bloodshed/kidnapping $3 premium
3.Iraq. US anoounce a troop pullout and the oil infrastructure is repairs $1 premium
4.Osama bin laden is captured thus partially removing the very real threat to Saudi Production through sabotage or removal of the Saud Royal Family.$2 premium
5 A whole lot of other factors

So if all the above occured the price could come back to US 47/bbl but sooner or later demand will outstrip supply and the price will go up again.And of course you have to realise that OPEC increasingly need a higher price not only to sustain their lifestyle but also pay for the resources to sqeeze incremental oil out of their ageing oilfields.

For Bollard to say the price of oil will come down because that's how these cycles work demonstrates quite clearly that he thinks just as the economists think.Unfortunately it's time to get REAL.



particulaly

tricha
11-06-2006, 05:10 PM
This is what Gerry posted on his subject about it.

Noteworthy Quote:

"In 1900, the US started to industrialize. We were using
one barrel of oil per person per year. By 1970, we were
using 27 barrels per person.

In 1950, Japan started to industrialize. They were using 1 barrel per person. By 1970, they were using 17.

In 1965, South Korea started to industrialize. They were using one barrel per person per year. By 2000 they were using 17.

Today, China uses 1.3 barrel per person per year and India uses 0.7."

Clyde C. Harrison

.................................................. ...................

So if India goes to 1.7 and China goes to 2.3 barrels per person per year.
We are looking at another 2.3 billion barrels per year consumption wery shortly, lets face it cars in China are multplying at a huge rate.

1 - Inflation rampent.

2 - Consumption increases.

3 - Peak oil here.

4 - World turbulance.

5 - Hurricanes and other natural disasters.

6 - The realisation that their oil is running out, the Arab States will be looking after it, make it last a lot longer and extract maxinium bucks for it.

I'm afraid Oil has only one way to go in the near future and that is up, up and away. It will become a luxury. Worth its weight in gold!

Cheers not so [B)][}:)]

JBmurc
11-06-2006, 07:46 PM
yes a very precious resourse,IMO we will never see $50usbbl or less ever again and is much more likely we'll see higher crude prices as the world oil giants hit peak oil production ;)-at current SP's TAP,STO,HDR,OSH,STU, look very cheap an great buying, they will be releasing there huge profits soon which should put the sector back on the bullish long term trend ;)

lanenz
11-06-2006, 08:29 PM
We are starting to go through the same phase as what happened during the 70's ealry 80's. As price of oil goes up then other commodities become more attractive. In my oinion it wont matter if the world runs out of oil because other resources would have taken over

Kookaburra
11-06-2006, 09:12 PM
quote:Originally posted by lanenz

We are starting to go through the same phase as what happened during the 70's ealry 80's. As price of oil goes up then other commodities become more attractive. In my oinion it wont matter if the world runs out of oil because other resources would have taken over



Yes the final determinant of price will be the cost of substitution from a variety of other oil sources such as the oil sands of Canada, deep sea oil, or substitution with biofuels, hydrogen etc. Once tooled up the cost of these substitutes may well be less than the present price of oil. We always tend to overdoo things and so the price is bound to have a medium term reduction but the long term cost of energy is bound to rise as more and more of the world wants a slice of the first world life style.

Mick100
11-06-2006, 10:01 PM
Bermuda

I have attemped to send you an email but it didn't get through. Could you email me via shaertrader to establish contact.

Thanks
.

airedale
12-06-2006, 08:35 AM
Hi Bermuda, likewise I could not get an email to you. Just wanted to say please keep us informed if Matthew Simmons agrees to speak in Chch.

bermuda
12-06-2006, 09:41 AM
Well keep you informed about Simmons visit.probably 50/50 at this stage but still hopeful.My email is aahopkins@xtra.co.nz.Snowing at the mo.

Mick100
12-06-2006, 11:06 AM
Hi bermuda
Still no luck attemping to reply to your email
When, or if, you get more concrete arrangments in place for a Simmons lecture in chch I would appreciate it if you could let me know - I will be keen to attend.

Thanks
,

tricha
12-06-2006, 12:58 PM
From the horses mouth.

BP boss says oil prices will fall

Lord Browne has overseen a period of powerful growth at BP
Lord Browne, the chief executive of oil firm BP, has said he expects crude prices to fall from current near-record levels as more supplies are discovered.
However Lord Browne, speaking in an interview with German magazine Der Spiegel, said there was not likely to be any dip in prices in the short term.

He said prices will probably settle at an average of about $40 a barrel in the medium term, before falling lower.

Prices have surged this year amid fears about supply and global instability.

No certainties

A combination of these factors pushed oil to more than $75 a barrel in April, amplifying concerns that the increased raw material costs would seriously impede global growth.

There was a short respite and dip in oil prices at the end of last week when top militant Abu Musab al-Zarqawi was killed in a US-led operation in Iraq this week.

Consumers are ready to pay for the protection of the environment

Lord Browne

A barrel of New York light crude was trading at $71.63, while a barrel of London benchmark Brent crude was at $70.48.

"We cannot really count on oil prices easing very much in the near future," Lord Browne told Der Spiegel in an interview due to be published on Monday.

"But is very likely that oil prices will range in the medium term around an average of $40," he continued. "In the long run it could even be $25 to $30."

Lord Browne said that companies were finding large oil deposits in the Caspian Sea, while there was good production potential in countries such as Russia and regions including Western Africa.

He also said that improved efficiency would help boost crude extraction.

"In the past we managed to get out 20% to 30%," Lord Browne said. "At the moment it's maybe 40% to 45%. I can see no reason why we could not reach 50% or 60%."

Green issues

One of the factors to emerge from the recent high oil prices has been an increased focus on developing alternative sources of energy.

Lord Browne said in the future consumers would have a large role to play in deciding the success of new technologies.

"Consumers are ready to pay for the protection of the environment," he explained. "In Europe more and more people get green electricity despite coming at a higher price. Ten years ago this would have been unimaginable."

bermuda
12-06-2006, 03:26 PM
Many years ago ( late 80's ) when I worked for BP the Chairman Robert Horton embarked on a very ambitious programme to grow BP through various aquisitions all based upon the premise that oil prices would increase to $US25/bbl.

Unfortunately for Horton he read it all wrong and in an unprecedented step the Board sacked him.BP's shareprice plummeted and thousands were laid off.

Now we have Lord Browne saying that the price of oil could come back to $US25-$US30/bbl.due to new oil finds in the Caspian Sea/Africa and better tecnology/efficiency at extracting oil.That is a big call.

Lord Browne works 18 hours a day but has he got too close to it and have his head in the sand? I would love to know his opinions on future Saudi production.

Hubbert's peak happened in the States back in 1970 and now it is happening to the world.

There will be a lot of oil around for a long time but it will be more expensive.We will then treat oil like the last bit in a tube of toothpaste.Just use a little bit and it will last longer..

Packersoldkidney
12-06-2006, 04:07 PM
quote:Originally posted by bermuda

Many years ago ( late 80's ) when I worked for BP the Chairman Robert Horton embarked on a very ambitious programme to grow BP through various aquisitions all based upon the premise that oil prices would increase to $US25/bbl.

Unfortunately for Horton he read it all wrong and in an unprecedented step the Board sacked him.BP's shareprice plummeted and thousands were laid off.

Now we have Lord Browne saying that the price of oil could come back to $US25-$US30/bbl.due to new oil finds in the Caspian Sea/Africa and better tecnology/efficiency at extracting oil.That is a big call.

Lord Browne works 18 hours a day but has he got too close to it and have his head in the sand? I would love to know his opinions on future Saudi production.

Hubbert's peak happened in the States back in 1970 and now it is happening to the world.

There will be a lot of oil around for a long time but it will be more expensive.We will then treat oil like the last bit in a tube of toothpaste.Just use a little bit and it will last longer..


To be honest I don't really put my predictions down to what the chairman of BP says. To me it's just the cycle: at the top of every resources boom, at the top of every cycle, everyone is saying: "this time it's different. This time the boom will go on foreever, just look at the fundamentals" Go back to the 1970's boom and that is what everyone was saying.....especially the economists. What happened? Decades long slump in resources.

Many economists are saying now that "this time it's different" because of China and India. Back in the 1970's it was Japan.

Now, I'm not saying to ignore fundamentals....because over the long haul fundamentals are certainly very important. Markets are not rational, and they overshoot either side in the short to medium term. I'm saying that at $70 US a barrel, the market has overshot itself for oil; I have no doubt that when oil unwinds in price, and all the stale short to medium term bulls are driven out, it will probably overshoot to the downside.

There is an instructive story told by Jesse Livermore about how he saw certain market conditions arising in the future, namely a bear market in stocks. As he tells it he saw this big pile of money waiting for him, and all he had to do was to sell the market short. Well, that's exactly what he did, and he was right, there was a bear market developing in stocks......the problem was he was too early. He lost track of where he was at and stopped looking at market conditons now and all he focused on was that big pile of money that was waiting for him in the future. He raced towards that big pile of money but by the time he got there he was broke by all the market rallies that happen in the dying stages of a bull market.

I have no doubt that at some stage in the future oil will be more expensive than what it is now; the fundamentals tell me that.....for me the question is what is happening now, and right now the market for oil has overshot itself, and frankly is now trading in the upper half of its range.

I couldn't care less about the decline of the great oil fields in the Middle East. They've been declining for decades, and will decline for decades more to come. They were declining when oil was at $20 US a barrel, and are declining now when its at $70 US a barrel, and will decline at any price you choose to name. When inventories are at decade long highs, the market will be quick to get its mind off the declining oil fields in the Mid East, and focus on other things, just as it did a decade ago when oil was about a third of the price it is now.

Mick100
12-06-2006, 05:12 PM
quote:Originally posted by Packersoldkidney
[

To be honest I don't really put my predictions down to what the chairman of BP says. To me it's just the cycle: at the top of every resources boom, at the top of every cycle, everyone is saying: "this time it's different. This time the boom will go on foreever, just look at the fundamentals" Go back to the 1970's boom and that is what everyone was saying.....especially the economists. What happened? Decades long slump in resources.




All of the resource bull markets in the past have run for 15 to 25 yrs with an average length of 18 yrs from bottom to top.
Your calling the end of this bull after just five yrs packers
I think that your at least 10 yrs early in calling the top
Bull markets climb a wall of worry and there will always be corrections to shake out the weak hands along with some speculators.
To me, these correction indicate a healthy bull market. If things kept going up continuously for 2-3 yr ,then I would be getting nervous. But so far we have had a correction every year so nothing to be concerned about. You make reference to the seventies bull in resources. This bull market actually began in the early 60's but it didn't go mainstream until the early 70's. So if we are going to compare this current bull with that of the 70's we would be at about 1966-67 now. The fact is that 99 out of 100 people don't even know that there is a bull market in commodities at the moment.
.

Packersoldkidney
12-06-2006, 06:05 PM
quote:Originally posted by Mick100


quote:Originally posted by Packersoldkidney
[

To be honest I don't really put my predictions down to what the chairman of BP says. To me it's just the cycle: at the top of every resources boom, at the top of every cycle, everyone is saying: "this time it's different. This time the boom will go on foreever, just look at the fundamentals" Go back to the 1970's boom and that is what everyone was saying.....especially the economists. What happened? Decades long slump in resources.




All of the resource bull markets in the past have run for 15 to 25 yrs with an average length of 18 yrs from bottom to top.
Your calling the end of this bull after just five yrs packers
I think that your at least 10 yrs early in calling the top
Bull markets climb a wall of worry and there will always be corrections to shake out the weak hands along with some speculators.
To me, these correction indicate a healthy bull market. If things kept going up continuously for 2-3 yr ,then I would be getting nervous. But so far we have had a correction every year so nothing to be concerned about. You make reference to the seventies bull in resources. This bull market actually began in the early 60's but it didn't go mainstream until the early 70's. So if we are going to compare this current bull with that of the 70's we would be at about 1966-67 now. The fact is that 99 out of 100 people don't even know that there is a bull market in commodities at the moment.
.


I think we are near an end of an extended bull run in stock markets, Mick. The latest 'mini bull' has been running in the US since, what? 2002/2003? It has been a very tepid run indeed: we haven't had a full blown bear market for decades really. This last 'mini' bull market, and in particular the flip-flopping we are seeing now in the US markets, is a sign to me that the 'great' bull market we've exprienced for 3 decades or more, is now on its last legs. Although I'm not really economically trained and don't rely on economic statistics, ostensibly because I think they are very good at stating what has happened rather than what will happen, it is interesting to look at the long haul view of certain economic statistics.

The last 'great' bull run ran from 1942 to 1966: the average GDP growth rate was 4.5%. A good measure of economic ill health, unemployment, was on a monthly average of 4.9%. At the end of the bull run, household's liquid assets were 161% of liabilities (meaning more assets than debts) Federal government debt was 43.9% of GDP.

In this current 'great' bull run, that has run since 1975, GDP growth was only 3.2% and monthly unemployment was 6.6%. Household's assets in 1999 were 93% of liabilities (meaning more debts than assets) Federal government debt in 1999 was 58.6% of GDP.

Now you'd think that, given the disparity of statistics favouring the bull run from '42 to '66, that the sharemarkets would have gone up much more then compared to the one from 1974. In actual fact, sharemarkets went up twice as much in the second bull run compared to the first.

In other words, historically, world markets are now massively overvalued. Now you know why fundamentalist people like Warren Buffett are saying that he's finding it difficult to locate 'value' in the market.....simply because there just isn't that much around.

If you factor in the fact that at the end of bull runs, it is generally the cyclical/commodity stocks that peak the last, and which are the first to fall - the exact situation we've seen in recent weeks - I think the current situation we are in is a worrying one if you are on the long side. Perhaps the sign of

Mick100
12-06-2006, 07:02 PM
First of all I want to make the distiction between general shares and commodity/resource shares. That's the first mistake your making packers by talking about all sectors of the sharemarket as though they are all the same.
Commodities are counter cyclical - they run in the opposite direction of the other sectors. The greatest bull market in general shares from 1982 to 2000 was parralled by the greatest bear market in commodities at the same time.
You claim that this bull market is coming to an end - I think that the bull market in general shares ended in 2000. They hve been going sideways for 5 yrs and will probably keep going sideways for another 10 - 15 yrs. As i said, commodities are counter cyclical - they go up while everything else goes down or sideways
I'v seen very good data, which spans 200 yrs, that proves that commodities are counter cyclical. There's no doubt in my mind that the latest switch from general shares to commodities occured between 1999 and 2001 during which time the dow and the s&p500 peaked.
Commodities are now in a long term bull market but it's going to be a rough ride. Not everyone will have the stomach to stay on board.
.

Packersoldkidney
12-06-2006, 07:08 PM
Fair enough, Mick. My data says that when the sharemarket tanks, so does everything else. Commodity or non-commodity. When the sharemarkets tank, cash is the only place to be.

Mick100
12-06-2006, 07:16 PM
quote:Originally posted by Packersoldkidney

Fair enough, Mick. My data says that when the sharemarket tanks, so does everything else. Commodity or non-commodity. When the sharemarkets tank, cash is the only place to be.


In the short term (couple of months) you may well be right packer.
,

Packersoldkidney
12-06-2006, 10:31 PM
I may be wrong, Mick, but at least my view is up here on the forum for you to pick at down the track. That is if I don't edit it first. (!)

port hills
13-06-2006, 08:50 AM
Packers and Mick,

Good intelligent debate/opinions, thanks for that it makes good reading, unlike much of what is written on these forums.

Packers regarding your debate perhaps the difference between this bull market for shares and the 1942-1966 one is the weight of investment money around in the developed nations due to the baby boom.
More demand for retirement savings vehicles making shares more expensive.

As an aside to say that shares are historically massively overvalued by comparing with just one other bull run holds no more
water than to say that shares from 1942-1966 were massively undervalued.

ps I'm approximatly 60% cash but expecting to do some buying of more resource stocks over the next month. Unlike MICK however I'm more of a short term trader.

skinny
13-06-2006, 09:36 AM
If you are bullish long-term about oil, or think that there is still a bounce or two left in the energy sector, I think there are some real bargains currently on US markets. Multi-billion dollar E&P cash cows with long-lived reserves and/or exploration activities in all the right spots (West Africa, Caspian, tar sands, etc) are sitting on current p/e's averaging around 8 and 2007 fwd p/e's around the same ammount or lower! The snapshot below for Apache corp is typical - low debt, huge free cash flow, and a PEG ratio that is particularly low. Others to look at include: Devon Energy, Conoco Phillips and Apache.

As soon as I see this current sell off turn, I know where my CFD trades are going :D

Apache Corp. (APA)

VALUATION MEASURES

Market Cap (intraday): 19.78B
Enterprise Value (12-Jun-06)3: 22.17B
Trailing P/E (ttm, intraday): 7.35
Forward P/E (fye 31-Dec-07) 1: 6.92
PEG Ratio (5 yr expected): 0.67
Price/Sales (ttm): 2.62
Price/Book (mrq): 1.81
Enterprise Value/Revenue (ttm)3: 2.87
Enterprise Value/EBITDA (ttm)3: 3.702


FINANCIAL HIGHLIGHTS

Fiscal Year
Fiscal Year Ends: 31-Dec
Most Recent Quarter (mrq): 31-Mar-06


Profitability
Profit Margin (ttm): 35.27%
Operating Margin (ttm): 57.99%


Management Effectiveness
Return on Assets (ttm): 15.44%
Return on Equity (ttm): 27.41%


Income Statement
Revenue (ttm): 7.72B
Revenue Per Share (ttm): 23.437
Qtrly Revenue Growth (yoy): 16.00%
Gross Profit (ttm): 6.44B
EBITDA (ttm): 5.99B
Net Income Avl to Common (ttm): 2.72B
Diluted EPS (ttm): 8.14
Qtrly Earnings Growth (yoy): 17.90%


Balance Sheet
Total Cash (mrq): 504.02M
Total Cash Per Share (mrq): 1.526
Total Debt (mrq): 2.35B
Total Debt/Equity (mrq): 0.208
Current Ratio (mrq): 1.104
Book Value Per Share (mrq): 33.778


Cash Flow Statement
Operating Cash Flow (ttm): 4.54B

JBmurc
16-06-2006, 10:45 AM
IMO-crude oil more likly to go to $75 than $25 or even $55



WASHINGTON (AP) - Tight oil markets and little spare production capacity worldwide make the United States more vulnerable today to a cutoff of Venezuelan oil than three years ago when a strike curtailed Venezuelan supplies, a congressional study warns.

The report by the Government Accountability Office says a Venezuelan oil embargo against the United States would cause oil prices immediately to jump by $4 to $6 a barrel and increase gasoline prices at the pump by 11 to 15 cents a gallon.

A six-month loss of 2.2 million barrels a day of Venezuelan production -- about what was lost during the strike by Venezuelan oil workers during the winter of 2002-03 -- could cause a price spike of $11 a barrel and cut U.S. economic output by $23 billion, the report said, citing an Energy Department computer model analysis.

Venezuela, the world's fifth-largest oil exporter, ships 1.5 million barrels a day of oil and petroleum products to the United States, accounting for 11 percent of U.S. imports. Most of Venezuela's oil that is not domestically consumed is shipped to the United States. Venezuela's government oil company owns or partly owns nine refineries in the United States.

Diplomatic relations between the two countries have been strained. Venezuelan President Hugo Chavez occasionally has threatened to cut off oil shipments to the United States and pursue other customers including China.

That caused Sen. Richard Lugar, R-Ind., chairman of the Senate Foreign Relations Committee, to ask the GAO, Congress' auditing agency, to examine the impact of a potential Venezuelan oil cutoff.

U.S. officials have minimized the likelihood of such a cutoff because Venezuela relies heavily on oil revenues from the United States to pay for its domestic programs.

Administration officials told the GAO investigators that "they do not have contingency plans to deal with oil losses specifically from Venezuela or any other single country" other than tapping the U.S. Strategic Petroleum Reserve or using diplomacy to get other countries to boost production, the draft report, obtained Wednesday, said.

When a strike by Venezuelan oil workers in the winter of 2002-2003 reduced the country's production by some 2.2 million barrels a day, the U.S. succeeded in getting other producers, especially Saudi Arabia, to fill the gap, the GAO study said.

"However, such diplomacy may be less effective today because there is currently very little spare production capacity" worldwide, and most of what there is -- about 1 million barrels a day -- is in Saudi Arabia.

The GAO report noted that Venezuela has continued oil imports into the United States at about the same level averaging 1.5 million barrels a day since the 2002-03 strike.

But it also cites U.S. government estimates that Venezuelan production has fallen from about 3.1 million barrels a day in 2001 to an average of 2.6 million barrels a day. Venezuela disputes those numbers and maintains that production has increased.

Nevertheless, the GAO report says that the United States has no long-term strategy to address a permanent drop in Venezuelan supplies.

"Although the U.S. government has options to mitigate impacts of short-term oil disruptions on crude oil and petroleum product prices, these mitigating actions are not designed to address a long-term loss of Venezuelan oil from the world market," said the report.

skinny
16-06-2006, 11:08 AM
Well, I am not so sure that oil prices will stay up long-term as outlined before, but short-term oil companies look oversold. In the end I bought CFD's on a couple of drillers on the NYSE (NE amd RIG).
Both trade on very low forward expected p/e multiples and have already signed-off contracts for their equipment so the revenue stream is more certain than with the oil explorers. In addition, the charts look super. Up 40% so far on the margin invested so not complaining :D:D

http://finance.yahoo.com/q/co?s=NE

JBmurc
17-06-2006, 04:40 PM
Oil Gains;)

Crude oil futures rose close to $70 a barrel in New York on signs that the economies of the U.S. and China are growing fast enough to sustain demand for fuel.

The Paris-based International Energy Agency said this week that 2006

global oil consumption would be 70,000 barrels a day more than it estimated in May.

``We'll see $80 by the end of the year,'' Boone Pickens, the Dallas hedge-fund manager who has made billions of dollars betting on higher oil prices, said in an interview today in New York. ``If demand is going up, and you're capped out on supply, it's got to go up.''
Oil for July delivery rose 38 cents, or 0.6 percent, to $69.88 a barrel. Prices are up 14 percent this year.
-TAP,ARQ,HDR,STX greAT buying IMO;)

kittydashwood
18-06-2006, 08:04 AM
i also hold RIG, UNT and recently took positions in PKD Parker Drilling which was oversold before the May correction.


Overall there appears to be weakness building in the oil services sector and we could see another shakeout at the end of the US summer.

JBmurc
18-06-2006, 11:16 AM
just finished a great book by- sonia shah
THE STORY OF CRUDE highly recommened IMO very informative


-Shell was interviewing three potential employees, a geologist,a geophysicist,and a petroleum reservoir estimation engineer.the test question asked was `what is two times two? The geologist mumbles for a while and announces that it is probably more than three,maybe less than five.The geophysicist punches it into his calulator and announes 3.9999.When the reservoir engineer is asked,he jumps up, locks the door,closes the shades,unplugs the phone,and whispers,What do you want it to be?.;)

airedale
18-06-2006, 01:17 PM
Good one JB, LOL:D

Mick100
20-06-2006, 01:12 AM
The commercial traders are increasing there long positions in crude

http://buythebottom.com/oil.html
.

bermuda
20-06-2006, 10:03 AM
Future of global oil production

For those that have audio, download an interview with Roger Blanchard by dialing up www.energybulletin.net and clicking onto North Sea Oil Production June 19.Scroll down to the end and click on the Global Public Media presentation.

An excellent overview.

bermuda
21-06-2006, 09:43 AM
Slightly off topic but dial up Iraq swamp oil( on google ) for a horrifying story on Iraq's inability to refine crude oil.

JBmurc
22-06-2006, 02:51 PM
NYMEX Light Sweet Crude +0.99 $70.33
IPE Brent +1.09 $69.17
Gasoline NY Harbor +0.0604 $2.0660
Heating Oil NY Harbor +0.0297 $1.9371
NYMEX Natural Gas +0.086 $6.588

;)

Packersoldkidney
22-06-2006, 05:27 PM
From US Department of Energy report June 22nd 2006:

"Total products supplied over the last four-week period has averaged nearly 20.9 million barrels per day, or 0.8 percent more than averaged over the same period last year. Over the last four weeks, motor gasoline demand has averaged 9.4 million barrels per day, or 0.9 percent above the same period last year. Distillate fuel demand has averaged nearly 4.1 million barrels per day over the last four weeks, or 1.1 percent above the same period last year. Jet fuel demand is up 1.7 percent over the last four weeks compared to the same four-week period last year."

I would warn people about extrapolating current economic data too far into the future.....just remember that current economic data won't tell you much about how markets will move next year.

Mick100
22-06-2006, 06:11 PM
Packers, your data proves that $70 oil is not putting any downward preasure on demand at all.

IMO,i don't think there will be any drop off in US demand until oil is over $100 per bbl
Demand will continue increasing at a rapid pace in asia even when oil is over $100 a bbl.
As Marc Faber put it a couple of yrs ago - "investing in oil is a no brainer"
,

Packersoldkidney
22-06-2006, 06:19 PM
quote:Originally posted by Mick100


Packers, your data proves that $70 oil is not putting any downward preasure on demand at all.

IMO,i don't think there will be any drop off in US demand until oil is over $100 per bbl
Demand will continue increasing at a rapid pace in asia even when oil is over $100 a bbl.
As Marc Faber put it a couple of yrs ago - "investing in oil is a no brainer"
,


You are right, Mick: if anything the data from the US DOE report indicates demand is actually increasing, not slacking off. I posted that info because I thought it relevant to the thread; it certainly undermines my short position view of oil though.

Packersoldkidney
24-06-2006, 01:26 PM
Big news in the oil sector overnight....people like Skinny who bet on an upsurge in oil stocks after the recent sell down will be making more profits methinks as soon as the full impact of this deal are understood. Looks as if there is a lot of money waiting on the sidelines to get into oil at the moment: there could be a scramble to get hold of quality O & G assets. How long this will take to percolate through to the rest of the world's markets is unknown at this stage.

Blockbuster $21 billion oil deals set

Texas-based Anadarko buying Kerr-McGee and Western Gas, adding deepwater and natural gas resources.

By Steve Hargreaves, CNNMoney.com staff writer
June 23, 2006: 1:10 PM EDT

NEW YORK (CNNMoney.com) - Anadarko Petroleum Corp. said Friday it is buying two rival energy companies for about $21 billion in cash, a move that will create the nation's fifth largest oil and gas producer.

The Texas-based company said it agreed to buy Colorado-based Western Gas Resources and Oklahoma's Kerr-McGee Corp. in deals under which it will also take on $2.2 billion in debt.

The deal pays a huge premium for the two firms, and shares of Kerr-McGee (up $18.30 to $68.60, Charts) surged 36 percent in early trading on the New York Stock Exchange while Western (up $18.84 to $59.75, Charts) skyrocketed 46 percent.

Anadarko (down $3.42 to $44.97, Charts) shares slid about 7 percent.

"An all-cash deal, it was unexpected and a very bold move," said Fadel Gheit, an analyst at Oppenheimer. "But I have faith in (Anadarko CEO Jim) Hackett. This is the crown achievement of his career, and he's not likely to buckle."

Gheit cited Kerr-McGee's extensive deepwater drilling expertise, saying the firm could go "head-to-head" with any of the bigger oil companies in the Gulf of Mexico.

"He's buying companies with complementary resources and tremendous upside potential," Gheit added.

Under the deal for Kerr-McGee, Anadarko is paying about $16.4 billion, or about $70.50 a share, plus the assumption of $1.6 billion in debt. Kerr-McGee closed Thursday at $50.30 on the New York Stock Exchange.

Separately, Anadarko is paying $4.7 billion, or $61 a share for Western, which closed at $40.91 Thursday.

Anadarko execs said they weren't bothered by what some called the high price for the companies, saying it was largely due to the recent drop in energy stock prices, meaning the companies being acquired were worth more when negotiations first began.

Neither company was publicly on the auction block when Anadarko approached them, he added.

"The long-term value hasn't become any different," said Hackett during a conference call. "We're very comfortable here. It's a great footprint for our combined operations, and a great growth vehicle."

The deals will be financed with $24 billion in funding provided UBS, Credit Suisse and Citigroup, Anadarko said.

A company spokeswoman said the company would sell some assets following the deal, but that the combined company would be about 50 percent larger, about the same size as Occidental (Charts).

Kerr-McGee was one of the first companies to pioneer deepwater drilling. Its core fields are in the Gulf of Mexico and onshore in Colorado and Utah.

In addition to its domestic operations, Kerr-McGee is exploring and developing fields offshore in China, Brazil, Australia, West Africa and in Alaska's North Slope.

The deal comes after a number of huge oil mergers several years back that formed the nation's biggest oil producers, Exxon Mobil, ChevronTexaco and ConocoPhillips.

But acquisitions have been limited for the last few years. Some lawmakers have blamed high oil and gas prices on a lack of competition in the industry and called for the breakup of some of the biggest oil companies.

Oil executives say they need the economies of scale to compete in an international market against huge state-owned oil companies, some of which are larger than Exxon Mobil, the world's largest publicly traded oil firm.

JBmurc
01-07-2006, 11:23 AM
-hope everyone,s buying up these undervalued ASX oilers
should be some great gains over the next year.
-my recent buy was the undervalued STX at 21.5c(sold recently at 34c) 49market cap,11m cash,making $25,000per day on first 2 drills at Mesquite with 2 more being tested ,holds Carnarvon basin permits with a 50mbbll drill there soon


NYMEX Light Sweet Crude +0.41 $73.93
IPE Brent +0.63 $73.51
Gasoline NY Harbor -0.0927 $2.2021
Heating Oil NY Harbor -0.0234 $1.9642
NYMEX Natural Gas -0.031 $6.104

SAN FRANCISCO (MarketWatch) -- Crude-oil futures closed at their highest level since mid-May, scoring a 7% gain for the quarter after eight winning sessions.
On Friday, traders focused on gasoline supplies heading into the July 4 holiday weekend, which is likely to prompt a spike in fuel consumption.
Regular trading on the New York Mercantile Exchange closed early Friday and will remain closed Monday and Tuesday for the Independence Day holiday.
"Fundamentals are moving more and more bearish, with the biggest first-quarter OECD inventory build in years," said Michael Lynch, president of Strategic Energy & Economic Research.
Supplies at the Organization of Economic Cooperation and Development, a group of 30 industrialized nations, normally drop about 1 million barrels a day in the first quarter. This year they rose about 300,000 barrels a day, he said.
But "the fear of hurricanes and the Iranian situation (among others) will keep the market on a boil," Lynch said.
Crude for August delivery rose 41 cents to finish at $73.93 a barrel Friday -- its highest closing level since May 12. It reached $74.15 a barrel, the loftiest intraday level since June 5.
August crude has gained 6.6% since the close of $69.34 on June 20. It closed Friday 4.3% above the week-ago close of $70.87 and up $4.84 from the end of the first-quarter price of $69.09.
"The longer crude stays above $70, the more likely a move above $80 becomes," analysts at Merrill Lynch said in a research note to clients. "Global economic prospects remain robust and asset reflation influences are intact."
The crude contract added more than $1 on Thursday, finding support from an oil-shipping snag in Louisiana and unexpected declines in U.S. crude and gasoline inventories in the latest week, reported by the Energy Department on Wednesday. The next weekly report will be released July 6, with the initial figures at 10:30 a.m. Eastern Time and the full report at 1 p.m. The report will be a day late because of the July 4 holiday.

arco
13-09-2006, 11:11 PM
I have calculated there is some Gann support in the 65.60 area, so that would be a region to look for a possible reversal signal.

GTA - arco

yogi-in-oz
07-11-2006, 04:12 AM
:)

Hi folks,

It will be shorter odds, than Pop Rock
in the Melbourne Cup, today .....

..... a cold snap in NYC is all that it will take to lift
heating oil prices and gas prices, again.

Figuring, that the last negative news for oil will be
around 24-29112006, then we can look for a rally
into the end of December 2006.

First half of January 2007 may see oil flat-to-down,
then rally from around 18012007-to-09022007 ...???

More later ..... :)

happy trading

yogi

P.S. ..... we will be alert for a BIG rally in oil,
around 29102007.

:)

=====

JBmurc
31-01-2007, 10:10 AM
[quote]Originally posted by yogi-in-oz


First half of January 2007 may see oil flat-to-down,
then rally from around 18012007-to-09022007 ...???

-Looks like where getting that rebound was always going to happen IMHO;)Great buying in STU,PPP,ARQ,STO,WPL,OSH of late

Oil Rises Most in 16 Months on Cold Weather, Economic Growth

By Mark Shenk

Jan. 30 (Bloomberg) -- Crude oil surged to its biggest gain in 16 months on speculation that colder weather and an improving economy will spur U.S. fuel consumption.

The National Weather Service predicted that below-normal temperatures will persist in the eastern U.S. for the next two weeks, and the price of natural gas, the country's most common home-heating fuel, jumped 11 percent. Consumer confidence in the U.S., where 25 percent of the world's oil is consumed, neared a five-year high, a report today showed.

``It's finally gotten cold, which will boost demand for natural gas and heating oil,'' said Bill O'Grady, director of fundamental futures research at A.G. Edwards & Sons in St. Louis. ``There's been a steady stream of good economic news in the U.S.,'' he said. ``The energy markets can no longer shrug off the economic numbers.''

Crude oil for March delivery rose $2.96, or 5.5 percent, to $56.97 a barrel on the New York Mercantile Exchange, the highest closing price since Jan. 3. It was the biggest one-day gain since Sept 19, 2005, when Hurricane Rita was approaching the U.S. Gulf of Mexico coast. Futures are 17 percent lower than a year ago.

``The weather turned cold and the funds came in,'' said Kyle Cooper, director of research at IAF Advisors in Houston. ``It looks like there's technical buying and new participants entering the market. I think holding $50 was an important signal for investors.''

Economic Indicators

New York futures dropped as low as $49.90 on Jan. 18. Prices shot higher in the two weeks since then because short sellers, who sold contracts in a bet on falling prices, started to buy them back once the market failed to stay below $50, Cooper said.

Brent crude oil for March settlement increased $2.71, or 5.1 percent, to $56.39 a barrel on the London-based ICE Futures exchange, the highest closing price since Jan. 3.

The Conference Board's index of U.S. consumer confidence rose to 110.3 this month, the highest since May 2002, from a revised 110 a month earlier, the New York-based group said today. Retail sales rose 0.9 percent in December, the most in five months, the government said on Jan. 12.

Heating demand in the U.S. Northeast, where 80 percent of the nation's heating oil is used, will be 20 percent above normal in the next week, according to Weather Derivatives, a forecaster in Belton, Missouri. Warm U.S. weather curbed heating-oil demand in December and the first half of January, and oil prices got as low as $49.90 a barrel on Jan. 18.

Coldest Winter Weather

``There are indications that the Northeast may see the coldest temperatures of the winter during the early part of next week,'' said Michael Palmerino, a forecaster at Lexington, Massachusetts-based Meteorlogix LLC. ``We're looking for temperatures that are 8-to-10 degrees below normal in both New York and Boston.''

Heating oil for February delivery rose 8.91 cents, or 5.8 percent, to $1.638 a gallon in New York, the highest close since Dec. 22. Natural gas for March delivery surged 80.3 cents, or 12 percent, to $7.74 per million British thermal units in New York, the highest close since Dec. 6. It was the biggest one-day gain since Oct. 16.

An Energy Department report tomorrow is expected to show that U.S. crude oil and gasoline inventories rose last week, according to the median of responses by 13 analysts surveyed by Bloomberg News. Analysts said the report will show supplies of distillate fuel, a category that includes heating oil and diesel, fell for the first time in seven weeks.

Crosscurrents

Oil is also getting support from the prospect that the Organization of Petroleum Exporting Countries will follow through on

Crypto Crude
10-02-2007, 01:00 AM
crudes on the rise again....
<center>US OIL OUTPUT SLIDES </center>
Oil production problems throughout north and south america will hurt US efforts to cut back on Mid east Crude imports, energy experts say.
Steep oil field decline rates in Mexico and Venezuela and problems in Offshore US and Canadian areas will lower output from the region, countering expectations of a rise.
Analysts predict North and South American oil supplies could fall by close to 200,000 barrels per day
[8D]
.^sc

JBmurc
10-02-2007, 08:59 AM
Crude Oil Rises After Nigeria Announces Production Cutbacks

By Mark Shenk

Feb. 9 (Bloomberg) -- Crude oil in New York rose to the highest close this year after Nigeria, Africa's biggest oil producer, said it will comply with OPEC production cuts.

Nigeria, the Organization of Petroleum Exporting Countries' sixth-biggest producer, is set to cut output by 142,000 barrels a day under agreements reached in 2006. Occidental Petroleum Corp., the fourth-biggest U.S. oil company, said 120,000 barrels a day of output has been lost after a fire at its Elk Hills field in California. It's the seventh-largest field on the U.S. mainland.

``There's some disagreement about the size of the cut but it's clear that some barrels will be taken off the market,'' said Tom Bentz, an oil broker with BNP Paribas Inc. in New York.

Crude oil for March delivery rose 18 cents, or 0.3 percent, to $59.89 a barrel on the New York Mercantile Exchange, the highest close since Dec. 29. Futures touched $60.80, the highest intraday price since Jan. 3. Prices are 1.5 percent higher this week and 4.4 percent lower than a year ago.

News reports from Dow Jones and other organizations said Nigeria was planning to cut as much as 300,000 barrels a day in March.

``What we're going to do is what OPEC has asked us to do,'' Levi Ajuonuma, spokesman for Nigerian National Petroleum Corp., said in an interview from Abuja. ``Nothing more.''

OPEC pledged to cut 500,000 barrels of oil a day from supplies starting this month, on top of a 1.2 million barrel-a- day reduction on Nov. 1.

Oil Supplies

``There have been a number of stories that demonstrate that oil supplies aren't to be taken for granted,'' said Tim Evans, an energy analyst at Citigroup Global Markets Inc. in New York. ``The Occidental field was shut down yesterday, the Hibernia field in Canada is also shut, there are problems with the Cantarell field and Norwegian production is declining.''

Output at Exxon Mobil Corp.'s Hibernia field in Canada will be closed from mid-February for as much as four weeks as it undergoes its biggest maintenance program in five years, a company spokeswoman said Feb. 7.

Production at the field, located offshore Newfoundland, has been hampered since Jan. 2, when a fuel valve failed in a generator and reduced power needed for production. Daily oil output in January averaged about 120,000 barrels, down from about 180,000 previously, the company said.

Petroleos Mexicanos, Mexico's state-owned oil company, said output will drop 15 percent this year at Cantarell, the world's third-largest oil field, said Chief Executive Officer Jesus Reyes Heroles on Feb. 7. Output at Cantarell in the Gulf of Campeche will fall to 1.53 million barrels per day in 2007, said Reyes Heroles. Cantarell produced 1.79 million barrels per day in 2006.

Norway dropped to fifth place among the world's crude-oil exporters last year as the nation's North Sea production declined, the Norwegian energy ministry said.

Cold Weather

Mild weather in December and early January helped push New York futures to $49.90 a barrel on Jan. 18, the lowest since May 25, 2005. The arrival of colder weather has helped drive prices higher this month.

``The weather along the Northeast will moderate over the weekend and we should see near-normal highs on Monday,'' said Dale Mohler, senior meteorologist at AccuWeather Inc. in State College, Pennsylvania. ``The relative warmth will last only one day and temperatures will trend back down Tuesday. We will soon see temperatures that are 12 to 15 degrees below normal.''

The normal high temperature in New York at this time of year is 39 degrees Fahrenheit (4 Celsius) and 27 degrees Fahrenheit is the normal low, according to the National Weather Service.

The Northeast

Home-heating demand in the Northeast, the region responsible for 80 percent of U.S. heating-oil use, will be 23 percent above normal for the next week, said Weather Derivatives, a forecaster in Belton, Missouri. The National Weather Service predicted that below

JBmurc
10-02-2007, 09:06 AM
Crude Oil Rises After Nigeria Announces Production Cutbacks

By Mark Shenk

Feb. 9 (Bloomberg) -- Crude oil in New York rose to the highest close this year after Nigeria, Africa's biggest oil producer, said it will comply with OPEC production cuts.

Nigeria, the Organization of Petroleum Exporting Countries' sixth-biggest producer, is set to cut output by 142,000 barrels a day under agreements reached in 2006. Occidental Petroleum Corp., the fourth-biggest U.S. oil company, said 120,000 barrels a day of output has been lost after a fire at its Elk Hills field in California. It's the seventh-largest field on the U.S. mainland.

``There's some disagreement about the size of the cut but it's clear that some barrels will be taken off the market,'' said Tom Bentz, an oil broker with BNP Paribas Inc. in New York.

Crude oil for March delivery rose 18 cents, or 0.3 percent, to $59.89 a barrel on the New York Mercantile Exchange, the highest close since Dec. 29. Futures touched $60.80, the highest intraday price since Jan. 3. Prices are 1.5 percent higher this week and 4.4 percent lower than a year ago.

News reports from Dow Jones and other organizations said Nigeria was planning to cut as much as 300,000 barrels a day in March.

``What we're going to do is what OPEC has asked us to do,'' Levi Ajuonuma, spokesman for Nigerian National Petroleum Corp., said in an interview from Abuja. ``Nothing more.''

OPEC pledged to cut 500,000 barrels of oil a day from supplies starting this month, on top of a 1.2 million barrel-a- day reduction on Nov. 1.

Oil Supplies

``There have been a number of stories that demonstrate that oil supplies aren't to be taken for granted,'' said Tim Evans, an energy analyst at Citigroup Global Markets Inc. in New York. ``The Occidental field was shut down yesterday, the Hibernia field in Canada is also shut, there are problems with the Cantarell field and Norwegian production is declining.''

Output at Exxon Mobil Corp.'s Hibernia field in Canada will be closed from mid-February for as much as four weeks as it undergoes its biggest maintenance program in five years, a company spokeswoman said Feb. 7.

Production at the field, located offshore Newfoundland, has been hampered since Jan. 2, when a fuel valve failed in a generator and reduced power needed for production. Daily oil output in January averaged about 120,000 barrels, down from about 180,000 previously, the company said.

Petroleos Mexicanos, Mexico's state-owned oil company, said output will drop 15 percent this year at Cantarell, the world's third-largest oil field, said Chief Executive Officer Jesus Reyes Heroles on Feb. 7. Output at Cantarell in the Gulf of Campeche will fall to 1.53 million barrels per day in 2007, said Reyes Heroles. Cantarell produced 1.79 million barrels per day in 2006.

Norway dropped to fifth place among the world's crude-oil exporters last year as the nation's North Sea production declined, the Norwegian energy ministry said.

Cold Weather

Mild weather in December and early January helped push New York futures to $49.90 a barrel on Jan. 18, the lowest since May 25, 2005. The arrival of colder weather has helped drive prices higher this month.

``The weather along the Northeast will moderate over the weekend and we should see near-normal highs on Monday,'' said Dale Mohler, senior meteorologist at AccuWeather Inc. in State College, Pennsylvania. ``The relative warmth will last only one day and temperatures will trend back down Tuesday. We will soon see temperatures that are 12 to 15 degrees below normal.''

The normal high temperature in New York at this time of year is 39 degrees Fahrenheit (4 Celsius) and 27 degrees Fahrenheit is the normal low, according to the National Weather Service.

The Northeast

Home-heating demand in the Northeast, the region responsible for 80 percent of U.S. heating-oil use, will be 23 percent above normal for the next week, said Weather Derivatives, a forecaster in Belton, Missouri. The National Weather Service predicted that below

Crypto Crude
10-02-2007, 01:49 PM
Going on advice from Arthur Lim...
he said that oil prices will remain around $60 over the medium term....
he said there will be times when oil falls to around 50, and times when oil goes higher....
but 60 is the benchmark.... 60 is OPECs equilibrium....
[8D]
.^sc

Mick100
15-02-2007, 09:07 PM
Commercial traders are going long crude oil
This set-up looks very bullish to me

Expect oil price to continue increasing in the immediate future

http://www.buythebottom.com/cot_charts/crude_oil_cot_chart.html
.

Mick100
14-05-2007, 02:24 PM
Most of the oilers have been going up in price over the past month or so. This could be signalling another sustained increase in the price of crude. Thats what I'm thinking.
,

airedale
14-05-2007, 06:22 PM
I hear what you are saying, Mick, but that sounds like putting the cart before the horse.

Mick100
14-05-2007, 07:38 PM
I hold a few STO (santos) shares airedale
They hit a low of around $9.00 earlier this yr. They're back up over $13.00 today
There's some big money buying oil stocks at the moment. I'v noticed that the shares of commodity type companies often move in price before the commodity itself - both to the upside and the downside. It will be interesting to see what happens to the price of crude over the next 6 - 12 months.
.

JBmurc
14-05-2007, 08:52 PM
IMHO alot of buyers are getting set for the US summer driving season lots of fuel hungry SUV's burning up more of the world most abused resource-I read somewhere awhile ago that the US defence forces are using over 60mbbl crude oil each yr in there opts.
-I think alot of the buying back into the WPL,STO etc is investors coming back from the recent fall in oil prices which in the long term picture is just a speedbump onto higher prices
remember during that speed bump all the so called experts&analyst talking the demise of Bulltrend in Oil with long term prices to go under $50 then to $40 and the only reason the prices were higher was the terror premium.

Crypto Crude
14-05-2007, 10:58 PM
Iraqi oil missing-
article... Billions of dollars worth of Iraqs declared oil production over the past four years is unaccounted for.

Between 100,000 and 300,000 barrels of Iraqs daily output of 2 million barrels is missing, possibly having being siphoned off through corruption or smuggling, the New York Times reports.

The discrepancy was valued between 5million dollars and 15million dollars per day...

These countrys are funked once their oil reserves are depleted...
include to this list all African nations, Nigeria... Middle east...
Maybe if these countrys had their fingers glued together then the dosh wouldnt slip through so easily...
[8D]
.^sc

Mick100
17-05-2007, 06:43 PM
Saudi oil production in decline?

http://www.theoildrum.com/node/2331
,

JBmurc
26-05-2007, 10:41 AM
12/06
BP boss says oil prices will fall

Lord Browne has overseen a period of powerful growth at BP
Lord Browne, the chief executive of oil firm BP, has said he expects crude prices to fall from current near-record levels as more supplies are discovered.
However Lord Browne, speaking in an interview with German magazine Der Spiegel, said there was not likely to be any dip in prices in the short term.

He said prices will probably settle at an average of about $40 a barrel in the medium term, before falling lower.

;)Yeah right-like I've been saying $100bbl is more likely than $40bbl
buy into the oil&energy sector while there's still some bargins from July onwards I believe this sector will be #1 to outperform on the ASX

Bargin buys checkout my(oil sector sell-off post)

P.S-Got 150k to be invested next couple weeks 80% will be in the oil%energy sector(total portfilo 70% oil&energy);)

JBmurc
09-08-2007, 05:15 PM
Rogers Says Oil Will Rise to $100 After `Correction' (Update6)

By Wendy Pugh and Yasumasa Song

Jan. 18 (Bloomberg) -- Oil will resume its march toward $100 a barrel after a ``correction,'' said Jim Rogers, who predicted the start of the commodities rally in 1999.

``I'm just not smart enough to know how far down it will go and how long it will stay, but I do know that within the context of the bull market, oil will go over $100,'' Rogers said in a Tokyo interview. ``It will go over $150. Whether that is in 2009 or 2013, I don't have a clue, but I know it's going to happen.''

Crude oil in New York has fallen 34 percent to a 19-month low since it peaked at a record $78.40 a barrel in July. Rogers, author of ``Hot Commodities,'' has said oil will keep rising because there hasn't been a major discovery for 30 years and economic growth in China and across Asia is driving up demand.

Rogers, 64, who created a series of commodities indexes and foresees a long-term bull market in oil, metals and grains, said he hadn't changed his positive view. The Rogers International Commodity Index, which more than doubled in the past five years, has dropped 13 percent in six months on a total return basis.

``When you have big bull markets, 50 percent corrections, or retractions, are normal,'' he said in an interview yesterday. ``It has often happened throughout history in a bull market.''

Oil for February delivery fell 16 cents, or 0.3 percent, to $52.08 a barrel in New York today as of 11:06 a.m. London time. It earlier rose as much as 41 cents to $52.65.

Lasting Correction

Rogers, in Tokyo to speak about commodities at an event organized by commodity futures trader Yutaka Shoji Co., said some corrections could last as long as two years, as happened to gold after a run-up in prices in the 1970s.

``Corrections go down long enough to scare everybody out and make sure they give up, and then they turn around,'' he said. ``We are in a secular bull market for commodities which has another decade or two to go.''

Crude oil will certainly rise above $100 a barrel before the bull market reaches an end, Rogers, who is chairman of Beeland Interests Inc., said in July after prices reached a record during fighting between Israel and Hezbollah in Lebanon.

He said corn, wheat and nickel had performed strongly even as the weighting given to oil dragged down the overall Rogers International Commodity Index.

Rogers doesn't buy individual commodities on the advice of his lawyers. He said he recently bought the Rogers Agriculture Index to benefit from surging grain demand. The index has fallen 0.5 percent this year on a total return basis.

He said he favored investment in non-U.S. dollar currencies, and had bought airline shares.

``The only airline where I'm losing money in the last year is Japan Airlines,'' he said.

To contact the reporter on this story: Wendy Pugh in Tokyo at wpugh@bloomberg.net ; Yasumasa Song in Tokyo at

airedale
09-08-2007, 08:26 PM
Hi JB, that's an iteresting report from Jim Rogers, but it is dated Jan.19th.
Why post it again tonight?:confused:

Mick100
09-08-2007, 09:20 PM
Hi JB, that's an iteresting report from Jim Rogers, but it is dated Jan.19th.
Why post it again tonight?:confused:


Had me confused there Murc

Another thing is - why would Jim Rogers be buying shares in airlines when he has already stated that oil is headed much higher in price. I would think that airlines are going to be the first to suffer the consequences of high fuel prices. :confused:
,

Halebop
09-08-2007, 09:37 PM
For the period in question in that article oil prices had fallen but economies remained strong so Airlines were viewed somewhat positively. I'd prefer to take Buffett's advice on the matter but like any cyclical industry they can deliver amazing returns if timed right.

JBmurc
10-08-2007, 10:15 AM
was att. to e-mail I recieved from CWA(thought it was only couple months old) was also amazed why Jim would be holding airline shares when airlines main cost was fuel esp. if it reached $100

lakedaemonian
11-08-2007, 09:09 AM
was att. to e-mail I recieved from CWA(thought it was only couple months old) was also amazed why Jim would be holding airline shares when airlines main cost was fuel esp. if it reached $100

To me it sounds quite odd that Jim Rogers would be investing in airline stocks for the following reasons:

1.)He has made repeated claims of being terrible at predicting the short-term, but doing a pretty good job of predicting the long-term trend(which is probably quite bad for all airline stocks) and investing accordingly.

2.) The financial health of airlines is dependant upon cheap or reasonably cheap energy, regardless of how efficient an airline may be(even the likes of a very efficient airline like Southwest Airlines in the US). Jim Rogers has been calling for energy prices to climb significantly going forward so why would be invest in something that would get crushed if his long-term prediction is true.

3.) Excepting China, I recall Jim Rogers saying he's putting his money where his mouth is by investing mostly in commodities as he believes equity markets will get killed while commodity markets will continue to surge for the next decade or so.

Sounds fishy.....anyone have any links to verifying Rogers investment in airline equities?

Everything I've read on him in the last 5-6 years since his visit to NZ in 2001 says China, Commodities, anti-US Dollar, pro-Yuan is all he cares about.

Mick100
25-08-2007, 11:59 AM
COT report

commercial traders net short positions:
7/08/07 net short 117500
14/08/07 net short 85700
21/08/07 net short 42600

obviously commercial traders (the hedgers) don't think demand for oil is going to diminish in the near future. They have reduced their short positions by almost 2/3 over the past three wks, ie they are closing their short positions - they don't think the oil price is going lower. :rolleyes:
,

Mick100
01-09-2007, 02:21 PM
Commercial (hedgers) net shorts positions
7/08/07 net short 117500
14/08/07 net short 85700
21/08/07 net short 42600
28/08/07 net short 25000

these figures are current to the tueday of each week - not friday (they are published on friday) Next week's cot report will be interesting - will see if, or to what extent, the commercials are increasing their shorts on the strengthening oil price.
Certainly looks as though prices are headed higher in the medium term - might crack $80 - third time lucky!:cool:

JBmurc
04-09-2007, 07:31 AM
Oil Rises in New York on Storm, Signs OPEC Won't Lift Output

By Grant Smith

Sept. 3 (Bloomberg) -- Crude oil rose from a four-week high in New York as a hurricane roared through the Caribbean Sea and OPEC ministers said the group won't increase production.

The Organization of Petroleum Exporting Countries will maintain existing output targets when it meets Sept. 11, the Algerian and Qatari oil ministers said. Hurricane Felix is on a westerly path that could reach Mexico's Cantarell, the world's third-largest oil field, by the end of this week.

``It all paints a picture of tight market supply,'' said Thina Saltvedt, an analyst at Nordea Bank in Oslo. ``The supply side will be tight in the fourth quarter if OPEC doesn't increase production.'' Hurricanes Dean and now Felix sparked concern over the rest of the Atlantic storm season, she said.

Crude oil for October delivery climbed 27 cents to $74.31 a barrel at 3:36 p.m. in electronic trading on the New York Mercantile Exchange. The contract traded as high as $74.60, the highest since Aug. 6. It settled at $74.04 at the end of last week, a four-week closing high. Floor trading on the New York exchange was closed today for Labor Day.

Brent crude oil for October settlement was at $73.41 a barrel, up 72 cents, or 1 percent, on the London-based ICE Futures Exchange. It rose 1.1 percent on Aug. 31.

OPEC, whose member nations supply more than 40 percent of the world's oil, will keep its current targets during the fourth quarter because the market is well-supplied with crude, Algerian Energy Minister Chakib Khelil said in an interview in Algiers. Qatari Oil Minister Abdullah bin Hamad Al-Attiyah said no change was necessary.

OPEC Outlook

``OPEC, regardless of what they decide to do, will probably expand production'' by about 200,000 barrels a day, said Francisco Blanch, the head of commodities research at Merrill Lynch & Co. ``I don't think inventories are very well equipped to deal with a cold start to the winter.''

Felix had 145-mile-per-hour winds, making it a Category 4 hurricane on the five-step Saffir-Simpson scale, as it made its way across the Caribbean toward an expected landfall in Central America tomorrow, the U.S. National Hurricane Center said on its Web site at about 2 p.m. Miami time. It was centered about 305 miles (491 kilometers) east of Cabo Gracias a Dios on the Honduras-Nicaragua border. The storm may pass through the Yucatan Peninsula, then enter the southern Gulf of Mexico.

``It's a very strong hurricane, but the track is still uncertain,'' said Olivier Jakob, managing director at Petromatrix GmbH in Zug, Switzerland. ``It is still too early to have full confidence that it will track to the Mexican Bay of Campeche oil fields.''

Katrina

Oil prices jumped to a then-record $70.85 a barrel on Aug. 30, 2005, after Hurricane Katrina wrecked rigs and platforms in the Gulf.

The Hurricane Center's forecast puts Felix on a more southerly course than Dean, the first hurricane of the Atlantic season. Dean struck Mexico's Yucatan Peninsula on Aug. 21, then crossed the peninsula into the Gulf. Mexico's oil production was cut by almost 2.7 million barrels a day. More than 80 percent of production was restored by Aug. 25.

New York oil prices have fallen 5.7 percent from the record $78.77 a barrel reached on Aug. 1. Prices declined as U.S. gasoline demand waned and prices dropped in the U.S. equity and credit markets. Turmoil in the financial markets threatened to ripple through the economy, slowing growth and weakening demand for energy in the world's largest oil consumer.

The U.S. Federal Reserve will probably lower interest rates to stimulate economic growth at its Sept. 18 meeting, drawing commodity funds back to the oil market, said Nordea's Saltvedt.

Hedge fund managers and other large speculators cut their bets on rising oil prices for a fourth week, according to U.S. Commodity Futures Trading Commission data published Aug. 31.

Net-long positions, the difference between contracts to buy and sell oil, fell 38 percent to 25,178 contracts in the week ended Aug. 28, the lowest in six months.

bermuda
04-09-2007, 03:28 PM
www.energybulletin.net

Iraq, oil, law and order.

Took me an hour to read but it does contain a lot of history.

You can see why Bush ( and Blair..read BP ) wanted this 'prize'

They are not going to get it easily.

airedale
04-09-2007, 08:16 PM
What a read, Bermuda. The next few weeks/months will be most critical for the Yanks. Perhaps the Brits have a good reason for winding down in Basra.

tricha
06-09-2007, 11:02 PM
Nippon Oil to buy Iran oil in yen

http://newsimg.bbc.co.uk/media/images/43034000/jpg/_43034511_refineryiran_ap.jpg Exporting oil provides a vital source of revenue for Iran

Japanese firm Nippon Oil is to start paying for Iranian oil in yen, rather than in US dollars.
The first payments to be made in the new currency for crude oil contracts will take place in October.
Iran has been increasingly selling oil in currencies other than the US dollar, which has fallen in value.
Iran, the fourth-biggest oil exporter, has made the shift in the light of political differences with the US over its nuclear programme.
While Iran says the project is for civilian purposes only, the US argues it is to develop nuclear weapons.
Last year, Iran inserted a clause into oil contracts enabling it to require payment in currency other than the US dollar. Iran and other countries that rely heavily on oil exports have been hard hit by the decline in the dollar's value. The move is not intended to change the original value of the oil contracts being traded.

Mick100
08-09-2007, 11:03 AM
Commercial (hedgers) net shorts positions
7/08/07 net short 117500
14/08/07 net short 85700
21/08/07 net short 42600
28/08/07 net short 25000
4/09/07 net short 34500

Commercials have increased net short positions this week - but not by much taking into account the rise in oil from 70 to $75. Looks like $80 oil will be tested in the near furure.:)
.

tricha
09-09-2007, 11:39 PM
OPEC May Reject Calls for More Supply With Oil at $76 (Update2)

By Maher Chmaytelli and Fred Pals
http://www.bloomberg.com/apps/data?pid=avimage&iid=iMx4SVVD46tU
http://images.bloomberg.com/r06/news/enlarge_details.gif (http://www.bloomberg.com/apps/news?pid=photos&sid=ahIufnL7JaR0)

Sept. 7 (Bloomberg) -- OPEC, the producer of 40 percent of the world's oil, may reject consumer calls to increase supplies and lower prices from $76 a barrel on concern energy demand will falter as U.S. economic growth slows.
Oil ministers for Algeria, Iran, Libya, Qatar and Venezuela said in the past week they support keeping the quota at 25.845 million barrels a day until December. OPEC President Mohamed al- Hamli, who is also the United Arab Emirates oil minister, said yesterday markets are ``adequately supplied.''
The Organization of Petroleum Exporting Countries will meet Sept. 11 at its Vienna headquarters to determine production targets for the fourth quarter, when heating fuel sales peak.
Oil rose 40 cents, or 0.5 percent to close at $76.60 a barrel today on the New York Mercantile Exchange. Futures have risen 26 percent this year, as 10 of the group's 12 members curtailed exports to drain inventories.
``I fear that OPEC has set implicitly a new target price of about $70 a barrel,'' said Claude Mandil in an interview on Aug. 30, his last day as director of the International Energy Agency, which advises 26 of the world's biggest oil-consuming nations. ``I deplore this because it weighs on the global economy and it's a burden for the poorest people.''
The Organization for Economic Cooperation and Development lowered its forecasts for economic growth this year in the U.S. and Europe on Sept. 5. The group cut its forecast for the U.S. to 1.9 percent from a May figure of 2.1 percent and for the 13 nations sharing the euro to 2.6 percent from 2.7 percent.
Half a Trillion
OPEC may make $530 billion next year from oil exports, up from $508 billion this year and $506 billion in 2006, according to Leo Drollas, the deputy director of the Centre for Global Energy Studies in London.
OPEC forecasts world oil demand will expand by 1.34 million barrels a day next year, or 1.6 percent, to 87.06 million barrels a day.
``I assure you that if there's any shortage we will supply more crude to the market, but I think the market is really stable at this time,'' OPEC Secretary-General Abdalla El-Badri said in an Aug. 28 interview in Luanda, Angola.
Members are pumping more than their agreement allows. The 10 members with quotas produced 26.71 million barrels a day last month, or about 860,000 barrels a day more than targeted, according to Bloomberg estimates. The planned cutback, agreed to in two meetings late last year, was 1.7 million barrels a day.
``OPEC is already dealing with its dilemma by gradually leaking more oil onto the market,'' said Adam Sieminski, Deutsche Bank's chief energy economist in New York.
Iraq, Angola
Iraq is allowed to export as much as possible to rebuild its oil industry after two wars. OPEC's newest participant, Angola, hasn't been assigned a limit. Crude output from all 12 OPEC members was 30.33 million barrels a day last month.
El-Badri said the 10 members with quotas have completed about 60 percent of their promised cutback and that any level above 65 percent would be ``fine.'' The organization hasn't set an official price target since abandoning a $22- to $28-a-barrel range in 2003, following the U.S.-led invasion of Iraq.
Ramon Espinasa, the former chief economist at state-run Petroleos de Venezuela SA, said OPEC members are content with prices and will seek a ``low profile'' meeting next week. He's now an economist at the Inter-American Development Bank in Washington.
Sub-Prime Worry
Indonesia, the only OPEC member recommending an increase in supplies, pays government subsidies on domestic fuel sales and imports crude to meet demand. Saudi Arabia, OPEC's largest producer, hasn't stated its position yet.
An increase in U.S. mortgage defaults by sub-prime borrowers would become a concern for oil producers if it causes ``a recession,'' Qatari Oil Minister Abdullah bin Hamad al-Attiyah said.
Libya's top oil official, Shokri Ghanem, said in a Sept. 4 interview that OPEC's record revenue is offsetting the weakness of the U.S. dollar, higher development costs and losses from the late 1990s, when demand sagged because of the financial crisis in Asia.
``OPEC keeps saying that there is sufficient supply,'' said Ingrid Angermann, an economist at Dresdner Bank AG said in an interview in Frankfurt today. ``At $76 a barrel, I don't see any sign of sufficient supply.''
To contact the reporter on this story: Maher Chmaytelli in Nicosia on mchmaytelli@bloomberg.net (mchmaytelli@bloomberg.net) ; Fred Pals in Amsterdam at fpals@bloomberg.net (fpals@bloomberg.net)
Last Updated: September 7, 2007 18:12 EDT

Heavy Metal
13-09-2007, 11:46 PM
Almost every year in the past decade the oil price has peaked around this time of year.

Can't see it any being any different this time as OPEC starts cranking up oil supply, the USA driving/hurricane season winds up and there is the potential (if the effects of the credit crunch spreads) of reduced demand.

Time to take profits in oil producers and buy back around Xmas time methinks.

shane_m
14-09-2007, 10:48 AM
I am trying to analyze some well data below, what does CP and CK mean?



MCF 263
Cond trace of oil
Water 235
CP 170#
CK 40

Tok3n
15-09-2007, 09:34 AM
Luv these drama queen articles that always come out during hurricane season

http://money.cnn.com/2007/09/14/news/economy/peak_oil/index.htm?postversion=2007091414

Mick100
15-09-2007, 12:09 PM
Commercial (hedgers) net shorts positions
7/08/07 net short 117500
14/08/07 net short 85700
21/08/07 net short 42600
28/08/07 net short 25000
4/09/07 net short 34500
11/09/07 net short 36000

Basiccally no change in net short positions this week with commercials adding 7000 short and 5800 long. Should see crude push through $80 next week
The fact that commercials are not significantly increasing short positions on a strengthening oil price is very bullish - short term
The question is - how high is it going to go:rolleyes:

tricha
16-09-2007, 11:24 PM
Mick100 "Basiccally no change in net short positions this week with commercials adding 7000 short and 5800 long. Should see crude push through $80 next week
The fact that commercials are not significantly increasing short positions on a strengthening oil price is very bullish - short term
The question is - how high is it going to go:rolleyes:"

Hey Mick do you still hold the penny dreadful :confused:

Judgement day coming soon for most of my oil portfilio.

ARQ and Emerald Oil @ Gas with the Valentine drill reaching target most likely today.

Drillsearch spudding Marina in the Bonaparte in a day or 3.

Northwest energy on the verge of earnings.

Great Artesian Oil & Gas to have new wells drilled soon.

NZO earning from Tui , new drill results very disappointing though.

Mick100
16-09-2007, 11:43 PM
Yeah tricha still hold three penny oilers - DLS, NWE, NDO
Looking forward to NDO finnally developing galoc oilfield, NWE collecting their royalties from puffin, and the exploration drilling this yr and next yr with DLS:)

digger
17-09-2007, 08:00 PM
Commercial (hedgers) net shorts positions
7/08/07 net short 117500
14/08/07 net short 85700
21/08/07 net short 42600
28/08/07 net short 25000
4/09/07 net short 34500
11/09/07 net short 36000

Basiccally no change in net short positions this week with commercials adding 7000 short and 5800 long. Should see crude push through $80 next week
The fact that commercials are not significantly increasing short positions on a strengthening oil price is very bullish - short term
The question is - how high is it going to go:rolleyes:


Mike100,thanks for posting these GOT reports. They seem to be reasonably accurate at indicating future prices.Has any survey been done over time on just how good these commerical short positions are for given future prices?

Heavy Metal
17-09-2007, 08:56 PM
Seems like an increasing number of analysts are sounding alarms in oil at current prices since there is no fundamental reasons supporting oil's recent rally. Only a short term drop in US oil inventories and speculative buying is propping up the price at the moment. As I've said before, oil reaches a cyclical annual peak around now.... back to $60 by Xmas?

http://biz.yahoo.com/ap/070917/oil_prices.html?.v=2

tricha
17-09-2007, 09:47 PM
Heavy Metal -"As I've said before, oil reaches a cyclical annual peak around now.... back to $60 by Xmas?"

Depends if we u believe in peak oil like I do :confused: (1000 barrells a second)


OPEC’s Cosmetic Production Increase Results in Upwards Price Trend
By Sven Ridley-Wordich
14 Sep 2007 at 12:00 PM GMT-04:00

AMERSTERDAM (ResourceInvestor.com) -- The unexpected production quota increase by OPEC, announced Sept. 11 in Vienna, has disappointed most analysts. The results of the OPEC meeting have been qualified as largely cosmetic, not having any real positive impact on global oil markets. The current price developments, already showing signs of an upward trend which could easily reach the $90 per barrel soon, have been a point of concern for most Western consumers.
However, the impact of current price developments will not be as large based on adjustments made for inflation and currency developments, and a real record price for oil still is not reached. Most analysts have stated that current oil prices, which have touched a level of above $80 per barrel, are in reality still lower than record prices set at the end of the 1970s. At the same time, the impact of oil on global economic developments, especially in the West, are increasingly based on perception, while negative economic effects have been minimal.

For the developing world, including China and India, the situation has become more problematic. Asia’s growing thirst for oil and gas needs to be countered by almost unheard of import volumes, as countries such as China, India and even Japan, are almost totally depended on energy imports. The latter needs to be financed by increased exports or internal loans. This situation will in the end slow down the still exponential growth of the latter economies, which will have its own impact on Western economic growth expectations.
In the meantime, OPEC’s current strategy showed again an unwillingness to take into account the increased economic dependency between producers and consumers. Saudi Arabian Minister of Oil Ali Al Naimi’s push for a 500,000-barrel-per-day production increase of OPEC is without any relevance. While trying to smooth up his relations with the U.S. and EU, Al Naimi has been unwilling and possibly incapable to force hard-liners within the oil cartel, such as Iran, Libya, Venezuela and Algeria, to open up their taps to give the oil market some hard-needed breathing space.
The 500,000 bpd of additional crude oil on the market is only a drop of what is needed the coming years. Some analysts have been less sceptical, stating that OPEC-10 (excluding Iraq and Angola) were already producing 900,000 bpd more than officially allowed. The latter fact was, however, known to the market (traders, hedge funds and analysts) for months, which means this fact was already incorporated in the current price analysis.
The new production increase of 500,000 bpd is also minimal when taking into account the fact that Abu Dhabi, an OPEC member, will be taking around 600,000 bpd out of the market the coming weeks due to planned maintenance of its fields. This will put another pressure on current price levels.
If really targeting a much more liquid global oil market, OPEC should have increased its volumes by at least 1.5 million to 2 million bpd, which would have countered predicted demand growth the coming two quarters. According to the International Energy Agency (IEA) in Paris, demand during the third and fourth quarters of 2007 will increase by 2 million bpd, due to winter season factors on the Northern Hemisphere and economic growth worldwide. The call on OPEC will increase, while total global oil production already is lagging behind. Latest figures have shown that at present, total demand already outstripped supply by between 1.3 million to 1.8 million bpd; this already has taken into account OPEC-10 overproduction before the Vienna meeting. In the coming months, this situation will be become even worse as demand will not at all be met, leaving aside possible additional disturbances in supply with issues in Iran, Syria and Venezuela.
Opinions differ on the reasons for OPEC’s current stand. The fact that OPEC’s production strategy in 1998 during the Asia crisis proved totally wrong, when Saudi Arabia dumped additional barrels on the market, which resulted in a price collapse to $8 per barrel, has been quoted as being behind OPEC’s current stand. Partly this could be a reason, but most probably national budgetary reasons are more applicable. Most OPEC countries are implementing or planning multi-billion mega-projects to increase their oil and gas capacities and diversify their respective economies. Without high oil windfalls this would not be possible. A further financial crisis in OPEC could also result in increased instability as most new projects are targeting greater local participation and employment. Western countries should not expect that OPEC countries will address pressing economic issues in their regions as important to their own local situations.
Although OPEC is feeling the heat from the West, the current policy will not be changed. National interests have taken over from global economic issues. Additionally, OPEC’s overall position as the world’s largest energy source is under pressure. Slowly the West will start to realize that OPEC could not be capable of increasing its production to targeted levels any more. Statements made by leading producers, such as Saudi Arabia, that there is still spare production capacity should be taken with a grain of salt. Oil analysts are increasingly worried that no spare capacity is available in the market, and OPEC is unable physically to increase production anymore.
Oil prices will continue their upward trend - $90 or even $100 per barrel are in reach. No real solution is presently available to prevent this from happening, except a total economic breakdown. The latter is at present not feasible; all signs are still on green for growth.
Consumers in the West should realize that their gasoline at the pump will become much more expensive the next months. The winter season is approaching; OPEC will not be able to provide the necessary oil blanket to cover us during that time.

shasta
17-09-2007, 09:51 PM
Heavy Metal -"As I've said before, oil reaches a cyclical annual peak around now.... back to $60 by Xmas?"

Depends if we u believe in peak oil like I do :confused: (1000 barrells a second)


OPEC’s Cosmetic Production Increase Results in Upwards Price Trend
By Sven Ridley-Wordich
14 Sep 2007 at 12:00 PM GMT-04:00

AMERSTERDAM (ResourceInvestor.com) -- The unexpected production quota increase by OPEC, announced Sept. 11 in Vienna, has disappointed most analysts. The results of the OPEC meeting have been qualified as largely cosmetic, not having any real positive impact on global oil markets. The current price developments, already showing signs of an upward trend which could easily reach the $90 per barrel soon, have been a point of concern for most Western consumers.
However, the impact of current price developments will not be as large based on adjustments made for inflation and currency developments, and a real record price for oil still is not reached. Most analysts have stated that current oil prices, which have touched a level of above $80 per barrel, are in reality still lower than record prices set at the end of the 1970s. At the same time, the impact of oil on global economic developments, especially in the West, are increasingly based on perception, while negative economic effects have been minimal.

For the developing world, including China and India, the situation has become more problematic. Asia’s growing thirst for oil and gas needs to be countered by almost unheard of import volumes, as countries such as China, India and even Japan, are almost totally depended on energy imports. The latter needs to be financed by increased exports or internal loans. This situation will in the end slow down the still exponential growth of the latter economies, which will have its own impact on Western economic growth expectations.
In the meantime, OPEC’s current strategy showed again an unwillingness to take into account the increased economic dependency between producers and consumers. Saudi Arabian Minister of Oil Ali Al Naimi’s push for a 500,000-barrel-per-day production increase of OPEC is without any relevance. While trying to smooth up his relations with the U.S. and EU, Al Naimi has been unwilling and possibly incapable to force hard-liners within the oil cartel, such as Iran, Libya, Venezuela and Algeria, to open up their taps to give the oil market some hard-needed breathing space.
The 500,000 bpd of additional crude oil on the market is only a drop of what is needed the coming years. Some analysts have been less sceptical, stating that OPEC-10 (excluding Iraq and Angola) were already producing 900,000 bpd more than officially allowed. The latter fact was, however, known to the market (traders, hedge funds and analysts) for months, which means this fact was already incorporated in the current price analysis.
The new production increase of 500,000 bpd is also minimal when taking into account the fact that Abu Dhabi, an OPEC member, will be taking around 600,000 bpd out of the market the coming weeks due to planned maintenance of its fields. This will put another pressure on current price levels.
If really targeting a much more liquid global oil market, OPEC should have increased its volumes by at least 1.5 million to 2 million bpd, which would have countered predicted demand growth the coming two quarters. According to the International Energy Agency (IEA) in Paris, demand during the third and fourth quarters of 2007 will increase by 2 million bpd, due to winter season factors on the Northern Hemisphere and economic growth worldwide. The call on OPEC will increase, while total global oil production already is lagging behind. Latest figures have shown that at present, total demand already outstripped supply by between 1.3 million to 1.8 million bpd; this already has taken into account OPEC-10 overproduction before the Vienna meeting. In the coming months, this situation will be become even worse as demand will not at all be met, leaving aside possible additional disturbances in supply with issues in Iran, Syria and Venezuela.
Opinions differ on the reasons for OPEC’s current stand. The fact that OPEC’s production strategy in 1998 during the Asia crisis proved totally wrong, when Saudi Arabia dumped additional barrels on the market, which resulted in a price collapse to $8 per barrel, has been quoted as being behind OPEC’s current stand. Partly this could be a reason, but most probably national budgetary reasons are more applicable. Most OPEC countries are implementing or planning multi-billion mega-projects to increase their oil and gas capacities and diversify their respective economies. Without high oil windfalls this would not be possible. A further financial crisis in OPEC could also result in increased instability as most new projects are targeting greater local participation and employment. Western countries should not expect that OPEC countries will address pressing economic issues in their regions as important to their own local situations.
Although OPEC is feeling the heat from the West, the current policy will not be changed. National interests have taken over from global economic issues. Additionally, OPEC’s overall position as the world’s largest energy source is under pressure. Slowly the West will start to realize that OPEC could not be capable of increasing its production to targeted levels any more. Statements made by leading producers, such as Saudi Arabia, that there is still spare production capacity should be taken with a grain of salt. Oil analysts are increasingly worried that no spare capacity is available in the market, and OPEC is unable physically to increase production anymore.
Oil prices will continue their upward trend - $90 or even $100 per barrel are in reach. No real solution is presently available to prevent this from happening, except a total economic breakdown. The latter is at present not feasible; all signs are still on green for growth.
Consumers in the West should realize that their gasoline at the pump will become much more expensive the next months. The winter season is approaching; OPEC will not be able to provide the necessary oil blanket to cover us during that time.


Oil looks likely to stay around the $US70 - 80 per barrel mark for the forseeable future.

I agree with Tricha re peak oil, & that last bit of the article saying oil is heading to $US90 - 100, it certainly is, but whether it spikes there & retreats or moves higher & stays is the big question.

Notwithstanding i'm looking for another oil producer to enter the "Shasta" stable.

Trouble is i've looked at so many & none stand out, to me anyway...

Heavy Metal
17-09-2007, 10:37 PM
I agree with Tricha re peak oil, & that last bit of the article saying oil is heading to $US90 - 100, it certainly is, but whether it spikes there & retreats or moves higher & stays is the big question.


That 'article' is from Resource Investor, another Kitco clone doom and gloom gold peddling website. Its views should be taken at face value.

Shasta, I share your belief that there are no ASX oil companies that represent good value at the moment, almost all of them disappoint come quarterly production report time. Why rush to buy anyway since there is a very high chance the oil price will drop significantly by the EOY - then it will be time to buy a few well chosen oil/gas companies.

Huang Chung
17-09-2007, 11:26 PM
Heavy Metal -"As I've said before, oil reaches a cyclical annual peak around now.... back to $60 by Xmas?"

Tricha - "Depends if we u believe in peak oil like I do :confused: (1000 barrells a second)"

Tricha, I would really be surprised if peak oil will have the sort of instant impact you seem to be implying. It's probably going to be a gradual realisation that peak production has been achieved, some time after the event has actually occurred...certainly not something that is going to impact the oil market one way or the other by this Christmas.

Mick100
17-09-2007, 11:53 PM
Heavy Metal -"As I've said before, oil reaches a cyclical annual peak around now.... back to $60 by Xmas?"

Tricha - "Depends if we u believe in peak oil like I do :confused: (1000 barrells a second)"

Tricha, I would really be surprised if peak oil will have the sort of instant impact you seem to be implying. It's probably going to be a gradual realisation that peak production has been achieved, some time after the event has actually occurred...certainly not something that is going to impact the oil market one way or the other by this Christmas.

Who's to say we haven't already hit peak oil
Richard Hienburge and Matt Simmons claim conventional oil production peaked in May, 2005 - they have yet to be proven wrong
OPEC keep saying that they can ramp up production - they have yet to prove it.
It will probably take some kind of event to trigger a realisation of peak oil - that event could be any number of things at any time.

Mick100
18-09-2007, 12:21 AM
Mike100,thanks for posting these GOT reports. They seem to be reasonably accurate at indicating future prices.Has any survey been done over time on just how good these commerical short positions are for given future prices?

digger
The information is only as good as the person analysing it
Different people will gain their own different insights from the COT reports

I have only started following them in the last few months myself so I'm no expert. One thing I do know is that the commercials represent the "smart money." Large traders and small speculators (momentum players) represent the "dumb money". That's why I follow the commercials.

I have gone over the historical reports from last yr when oil peaked in july -august at $78. Net short positions peaked at 75000 contracts on open interest of 1,200,000 contracts. At present open interest stands at 1,500,000 contracts - 25% higher than last yr. So if we assume the same buying/selling pressures as last yr we should expect a peak in net shorts of around 94,000 contracts (75000 + 25%)
Also the recent peak this yr in july-august, net short positions ranged between 104,000 and 119,000 throughout this period.
My estimate of a turning point in price will be when net shorts are over 90,000 but probably closer to 120,000 - then it's just a matter of watching the chart for weakness.
At the moment it looks as if we will test $90.
.

Huang Chung
18-09-2007, 12:42 AM
Mick100 - Who's to say we haven't already hit peak oil

Exactly my point Mick, it's not one of those things where a bell will ring once we've reached peak production, it might take a year or two to realise that the peak has come and gone.

Even if we do go past the peak, what will be important is how quickly supply will start to drop off.....a slow decline or something sharper. Probably, world production will bob around peak levels for a number of years before tapering off in any significant way. Will there be panic, and when, who would really know at this stage of the game.

tricha
18-09-2007, 12:59 AM
Who's to say we haven't already hit peak oil
Richard Hienburge and Matt Simmons claim conventional oil production peaked in May, 2005 - they have yet to be proven wrong
OPEC keep saying that they can ramp up production - they have yet to prove it.
It will probably take some kind of event to trigger a realisation of peak oil - that event could be any number of things at any time.

Exactly Mick one of the seven deadly sins will blow oil way past $100 a barrell, watch the panic set in then, carless days, speed limits lowered, it will get ugly again for a lot longer this time around.

I know I keep going on about it Huang, the answers to your questions are in this book, " 1000 barrells a second " excellent reading if u want to try and stay, ahead of the herd ;)

Huang - "Even if we do go past the peak, what will be important is how quickly supply will start to drop off.....a slow decline or something sharper. Probably, world production will bob around peak levels for a number of years before tapering off in any significant way. Will there be panic, and when, who would really know at this stage of the game. "

digger
18-09-2007, 05:34 AM
digger
The information is only as good as the person analysing it
Different people will gain their own different insights from the COT reports

I have only started following them in the last few months myself so I'm no expert. One thing I do know is that the commercials represent the "smart money." Large traders and small speculators (momentum players) represent the "dumb money". That's why I follow the commercials.

I have gone over the historical reports from last yr when oil peaked in july -august at $78. Net short positions peaked at 75000 contracts on open interest of 1,200,000 contracts. At present open interest stands at 1,500,000 contracts - 25% higher than last yr. So if we assume the same buying/selling pressures as last yr we should expect a peak in net shorts of around 94,000 contracts (75000 + 25%)
Also the recent peak this yr in july-august, net short positions ranged between 104,000 and 119,000 throughout this period.
My estimate of a turning point in price will be when net shorts are over 90,000 but probably closer to 120,000 - then it's just a matter of watching the chart for weakness.
At the moment it looks as if we will test $90.
.

Thanks again Mick100,most interesting way of looking at it.

digger
18-09-2007, 05:46 AM
Doubly interesting seeing that WTI has just hit a new record high of 80-59. Might have to get some info and start studying these commericals COT reports.

Gofish.
18-09-2007, 11:20 AM
http://news.independent.co.uk/business/news/article2966842.ece (http://news.independent.co.uk/business/news/article2966842.ece)

18 September 2007 10:55
Oil industry 'sleepwalking into crisis'

Former Shell chairman says that diminishing resources could push price of crude to $150 a barrel

By David Strahan and Andrew Murray-Watson

Published: 17 September 2007

Lord Oxburgh, the former chairman of Shell, has issued a stark warning that the price of oil could hit $150 per barrel, with oil production peaking within the next 20 years.
He accused the industry of having its head "in the sand" about the depletion of supplies, and warned: "We may be sleepwalking into a problem which is actually going to be very serious and it may be too late to do anything about it by the time we are fully aware."
In an interview with The Independent on Sunday ahead of his address to the Association for the Study of Peak Oil in Ireland this week, Lord Oxburgh, one of the most respected names in the energy industry, said a rapid increase in the price of oil was inevitable as demand continued to outstrip supply. He said: "We can probably go on extracting oil from the ground for a very long time, but it is going to get very expensive indeed.
"And once you see oil prices in excess of $100 or $150 a barrel, the alternatives simply become more attractive on price grounds if on no others."
Lord Oxburgh added that oil majors must invest more heavily in developing viable alternatives to oil and gas. "If you look at it from oil companies' point of view, effectively what they're doing at the moment is continuing business as usual, and sticking their toes in the water in a number of areas which might become important in future.
"But at present there is a relatively poor business case for making significantly greater investment in these new areas."
Commenting on whether "peak oil" – the point when global oil production goes into terminal decline – was likely to be reached in the near future, he said: "In a way it scarcely matters; what really matters is the gap between production and demand. I don't know whether there is going to be a peak in world oil production, whether it's going to plateau and then slowly come down.
"It could well plateau within the next 20 years, and I guess I would be surprised if it hadn't."
The price of crude oil closed above $80 a barrel for the first time on Thursday, as a hurricane in Texas raised supply concerns.
US light crude hit $80.20, two cents higher than the price it touched on Wednesday. Oil prices have risen 30 per cent since the start of this year and are four times higher than their 2002 level.
The latest figures from the US Energy Information Administration show that global liquid fuels production in August was almost a million barrels per day lower than the same period in 2006.
The International Energy Agency has forecast what it calls an oil "supply crunch" by 2012, a prediction that Lord Oxburgh said could possibly come to pass. Lord Oxburgh is currently chairman of D1 Oils, a biodiesel company listed on the AIM market.

tricha
18-09-2007, 03:27 PM
Gofish - "The latest figures from the US Energy Information Administration show that global liquid fuels production in August was almost a million barrels per day lower than the same period in 2006."


Break point!



Oil hits record on supply fears

http://newsimg.bbc.co.uk/media/images/44112000/jpg/_44112781_oilpictureap203jpg.jpg Prices have been above $70 for much of the past year

Oil prices have hit another record - breaching the $81 a barrel mark for the first time.
US light, sweet crude hit $81.01 in after hours trade on worries about rising demand amid constrained supply.
Supplies of oil in the US are running at their lowest level in eight months with fears that world energy supplies will hit critical levels this winter.
The Organization of the Petroleum Exporting Countries (Opec) last week agreed on a small supply increase.
But analysts do not believe the 500,000 barrels per day hike in output is sufficient to stem the rally in oil prices.
"We believe that this will be too little, too late, barring an outright collapse in demand, and now expect inventories to draw to critical levels this winter," said investment bank Goldman Sachs. The firm predicted that oil prices would hit $85 a barrel by the end of this year. In London on Monday, Brent crude rose 76 cents to $76.98 a barrel.

Huang Chung
20-09-2007, 12:40 AM
Dipped my big toe back into the oil patch today by picking up some AED.

This stock has been kind to me in the past, and I'm hoping for a repeat performance. All things going well, it should be less than a fortnight to 'first oil', which, as Shrewdy keeps telling us, should mean a re-rating.

Here's hoping. :)

Oiler
20-09-2007, 06:45 AM
Chavez vows to expand gas, oil production
Eric Watkins
Senior Correspondent
LOS ANGELES, Sept. 19 -- Venezuelan President Hugo Chavez said his government is "launching the socialist gas revolution," claiming that Venezuela possesses "80% of South America's gas reserves" and "30% of the gas reserves in the Americas."
He said Sept. 16 that his administration would invest $18 billion to expand natural gas production to 11 bcfd over the next 5 years from 7 bcfd.
Touting his country's assets, Chavez said Venezuela has proved gas reserves of 150 tcf onshore and 30 tcf offshore.
Meanwhile, the Venezuelan leader said his government also plans to increase the country's production of crude oil to "5 million b/d in 2012," up from the current 3.2 million b/d.
"We'll take it there on pace with prices because for us it's more important to maintain the correct price of oil than to flood the market," said Chavez, who added that the world is entering an energy crisis because "oil is running out."
Contact Eric Watkins at hippalus@yahoo.com.

Chavez has spoken so it must be true.....we are running out of oil. :)

Mick100
22-09-2007, 12:49 PM
Commercial (hedgers) net shorts positions
7/08/07 net short 117500
14/08/07 net short 85700
21/08/07 net short 42600
28/08/07 net short 25000
4/09/07 net short 34500
11/09/07 net short 36000
18/09/07 net short 44500

open interest - 1,488,000

Commercials decreased shorts by 26000 and decreased longs by 35000 to give a net increase in shorts of approx 9000 from last week

Considering the strength in the oil price this increase in net shorts is insignificant, IMO. I am looking for a net short position of 90,000+ before this run is at/near it's peak price - looks as though we have some way to go yet:)

tricha
28-09-2007, 10:55 PM
http://www.smartstox.com/interviews/a_michael_berry.php

Mick100
29-09-2007, 11:34 AM
Commercial (hedgers) net shorts positions

price
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50


commercialls reduced shorts by 59000 and reduced longs by 60000
open interest - 1,410,000
Both longs and shorts closing out positions this week, stand-off


,

tricha
01-10-2007, 08:41 PM
Oil Price Threatened by Weather and Middle East Explosion
By Sven Ridley-Wordich
28 Sep 2007 at 11:01 AM GMT-04:00

AMERSTERDAM (ResourceInvestor.com) -- Global oil prices are heading toward another increase the coming days. A major storm developing in the Gulf of Mexico, a gas explosion in the UAE and a possible conflict between Total [NYSE:TOT (http://finance.yahoo.com/q?s=TOT)] and Iran will put renewed pressure on current oil price levels.
A new storm developing in the Gulf of Mexico is causing Asian oil traders to expect further price increases due to possible closings of major oil fields in the area. The chance of an unexpected oil output reduction will put additional pressure on American oil production and import levels, which already are showing constraints.

Oil prices in New York and Brent crude already have moved up several dollars, showing a tendency to surge even through the $85 per barrel barrier for the NYMEX crude. Brent crude also has gone up, breaking through the magical $80 per barrel barrier. Analysts are worried that the Gulf of Mexico storm will only increase already constrained market fundamentals, as the OPEC production quota increase of 500,000 barrels per day in the past weeks is seen as insignificant. At the same time, several OPEC producers have indicated that will not even be able to produce up to the levels approved by OPEC.
The U.S. National Hurricane Center has warned that a current tropical depression, which is heading towards the coast of Mexico, could grow into a tropical storm. Other analysts have reported that American refinery run rates have dropped, indicating that there is a bottleneck in the system which has not yet been recognized fully by the market. If no measures are being taken - and refinery production keeps under stress - the American heating oil market will be severely pressured. Possible effects for the European market are already expected, as a fall in supply in the U.S. is normally covered by increased imports from European plants. A tighter market could be the result, pushing most prices of products to higher levels than expected already.
The current price developments come unexpectedly, as the U.S. Department of Energy had reported recently that there has been an unanticipated build-up of stocks. However, these normally positive figures, which would have caused prices to fall, only had a temporary effect. Several American analysts have indicated that the unexpected price increase - before the news of the Gulf storm was reported - has come because funds have taken a closer look at the statistics and emphasized the draw in Cushing barrels. Funds appear to have been going on a buying spree. As reported in the press, when front-month prices are higher than months further out, it as seen as an indication that immediate supplies are tight. The situation, known as backwardation, also encourages commodity investment funds to buy crude because it reduces the cost of rolling over near-month contracts to the next month as they expire.
At the same time as the United Arab Emirates has to cut its oil production by around 600,000 bpd due to scheduled maintenance in November, another setback to the country’s production level occurred. The Abu Dhabi National Oil Company (ADNOC) reported that a minor gas leak has triggered a shutdown that will cut average oil output in the UAE by 40,000 bpd in September. The UAE is the world's sixth-largest oil exporter and produced around 2.56 million bpd of crude in August.
The oil market is also keeping a wary eye on developments surrounding Iran, as the latter is not only threatened by UN Sanctions or even a military confrontation with the U.S., EU and Israel. Tehran even has put more oil on the fire, as the government reiterated that it will kick French oil and gas major Total out of the South Pars field development project. As reported, Iran has warned France it was prepared to go ahead with the major gas project. The main point of the conflict currently is Total’s unwillingness to put in place the final investment decision for the South Pars project. Iran’s Minister of Oil Gholam Hossein Nozari stated that “if Total does not come here, right here, the Pars LNG contracts will be handed over to capable Iranian hands for them to carry out.” Total’s project would entail phase 11 of the giant South Pars gas field, where it would be investing to produce liquefied natural gas (LNG) for export and to build a liquefaction plant. Analysts have also stated that growing French confrontational policy has angered Iran. The new French president Nicolas Sarkozy has stated that European states should take measures outside the regime of UN sanctions to put pressure on Tehran over its nuclear program. Sarkozy has called upon French and European companies to leave Iran and not to bid for new projects until all issues are solved.

Heavy Metal
01-10-2007, 10:03 PM
Oil Price Threatened by Weather and Middle East Explosion
By Sven Ridley-Wordich
28 Sep 2007 at 11:01 AM GMT-04:00

[FONT=Times New Roman, Times, serif]AMERSTERDAM (ResourceInvestor.com) -- Global oil prices are heading toward another increase the coming days. A major storm developing in the Gulf of Mexico,

What major storm? No news about any damage to oil rigs or refineries.

That story is 3 days old....

yogi-in-oz
05-10-2007, 05:15 PM
:)

Warning: Astrostuff ahead ..... :)

Hi folks,

Crude price will likely see some hefty rises soon, particularly
between 24102007 and 09112007, where some expansive
time cycles (Jupiter/Neptune) come into play.

In particular, we'll be alert around 30102007, when a hike
in oil prices may also be accompanied by some negative
news in currency markets, as well (???)

Longer term outlook ... if you think oil prices are high now,
just wait until May and December 2009 ... !~!

have a great day

paul

:)

=====

Mick100
06-10-2007, 11:42 AM
[QUOTE=Mick100;166946]Commercial (hedgers) net shorts positions

price
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
open interest 1,426,000
QUOTE]

commercial net shorts creeping up
Still someway to go yet before we reach a turning point
Hopefully this run-up will finish witha spike
.

Mick100
13-10-2007, 02:25 PM
[quote=Mick100;166946]Commercial (hedgers) net shorts positions

price
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26

open interest 1,441,000
.

commercial net shorts up slightly this week with commercials adding 12000 shorts and 6000 longs. This is still quite bullish IMO - should have a sniff at $90 before too long

Mick100
17-10-2007, 12:33 AM
ENERGY SECTOR DEVELOPMENTS REMAIN BULLISHby Joseph Dancy, LSGI Advisors, Inc.
Adjunct Professor, SMU School of Law
October 15, 2007

http://s7.addthis.com/button1-bm.gif (http://www.addthis.com/bookmark.php?v=12&pub=financialsense&s=&url=http%3A%2F%2Fwww.financialsense.com%2Ffsu%2Fed itorials%2Fdancy%2F2007%2F1015.html&title=FSU%20Editorial%3A%20%22Energy%20Sector%20De velopments%20Remain%20Bullish%20by%20Joseph%20Danc y%2010%2F15%2F2007)
The energy consulting firm of Groppe Long & Littell made a presentation to the Kansas Independent Oil & Gas Association last month on the outlook for the energy sector. Two charts prepared by that firm are worth reviewing: http://www.financialsense.com/fsu/editorials/dancy/2007/1015.h9.jpg
WORLD OIL PRODUCTION

Note the explosive growth in global production from 1945 to 1970. Much of the oil and gas regulatory and legal structure was established during this period of explosive growth.
In 1972 the largest swing oil producer at the time – the State of Texas – saw excess productive capacity shrink to zero. The Texas ‘allowable’ – how much an operator could produce – was raised to 100%, the maximum legal limit.
Note the steep growth in production from both OPEC and Other Non-OPEC countries from 1985 to 2005, and the projected plateau and decline of production in Non-OPEC countries starting in 2005
Liquids production from condensate and natural gas liquids increased substantially from 1985 to 2005. Without these incremental liquids the global supply situation would be much tighter.<LI class=MsoNormal style="mso-list: l3 level1 lfo1; tab-stops: list .5in">While global production is expected to peak in the 2010 time frame according to the presentation, global demand has been increasing at roughly 1.5% per year. Global economic growth and crude oil use are strongly correlated.
http://www.financialsense.com/fsu/editorials/dancy/2007/1015.h10.jpgLong term trends in global supply and demand point to higher prices – possibly much higher prices.
U.S. NATURAL GAS PRODUCTION

Note that conventional onshore natural gas production in the U.S. peaked in the early 1970’s – about the same time U.S. crude oil production peaked.
Offshore natural gas production has declined the last few years, in part due to hurricane damage that permanently shut-in some of the offshore fields
Note the explosion of ‘tight’ and coalbed methane production since 1990 – these are sometimes referred to as ‘unconventional’ natural gas reserves. <LI class=MsoNormal style="mso-list: l0 level1 lfo3; tab-stops: list .5in">Much of the decline in natural gas production from conventional reserves has been mitigated in the last decade by the boom in the unconventional production.
Many experts think the future U.S. natural gas production decline will be severe – which is why many planners expect imported liquefied natural gas (LNG) will play a major role in our energy future.
Long term trends in U.S. supply and demand point to higher prices for natural gas
http://www.financialsense.com/images/icons/storyend.gif
© 2007 Joseph Dancy
Editorial Archive (http://www.financialsense.com/fsu/editorials/dancy/archive.html)

Heavy Metal
17-10-2007, 09:31 PM
commercial net shorts creeping up
Still someway to go yet before we reach a turning point
Hopefully this run-up will finish witha spike
.

Good call on the spike.

I was staying on the sidelines to buy oil companies cheaper by the EOY but with the price spike have started shorting oil co's today.

tricha
17-10-2007, 10:02 PM
That 'article' is from Resource Investor, another Kitco clone doom and gloom gold peddling website. Its views should be taken at face value.

Shasta, I share your belief that there are no ASX oil companies that represent good value at the moment, almost all of them disappoint come quarterly production report time. Why rush to buy anyway since there is a very high chance the oil price will drop significantly by the EOY - then it will be time to buy a few well chosen oil/gas companies.

Well, Well, Well reality set in I see:rolleyes:

yogi-in-oz
18-10-2007, 01:51 AM
I was staying on the sidelines to buy oil companies cheaper by the EOY but with the price spike have started shorting oil co's today.

:)

..... is this guy really serious about shorting the oilers, Tricha ... ???

have a great day

paul

:)

=====

Mick100
20-10-2007, 12:53 PM
[quote=Mick100;167752][quote=Mick100;166946]Commercial (hedgers) net shorts positions

price
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26
16/10/07 net short 78000 87.61

open interest 1,489,300

commercials added 41000 shorts and added 29000 longs for a net increase in shorts of 12000 for the week
crude price up 9% for the week

I was expecting a big increase in net shorts this week as the commercials usually pile on the shorts on price spikes. It looks different this time - maybe the commercials don't think this increase in price is just a spike as I had been thinking. Looks as though it's going to go past $90 at this stage. :)

the machine
20-10-2007, 03:15 PM
am pretty glad are overweight in oil @ about 65% of portfolio

M

yogi-in-oz
21-10-2007, 07:38 PM
:)

Warning: Astrostuff ahead ..... :)

Hi folks,

Crude price will likely see some hefty rises soon, particularly
between 24102007 and 09112007, where some expansive
time cycles (Jupiter/Neptune) come into play.

In particular, we'll be alert around 30102007, when a hike
in oil prices may also be accompanied by some negative
news in currency markets, as well (???)

Longer term outlook ... if you think oil prices are high now,
just wait until May and December 2009 ... !~!

have a great day

paul

:)

=====

..... looking good ... !~!

happy days

paul

:)


=====

the machine
22-10-2007, 01:22 AM
turkey shelling iraq kurds , kidnapping in nigeria, algerian oil minister saying oil price will rise above usd$90 - all add up to another week of high oil prices.

M

Mick100
27-10-2007, 02:28 PM
[quote=Mick100;169708][quote=Mick100;167752][quote=Mick100;166946]Commercial (hedgers) net shorts positions

price
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26
16/10/07 net short 78000 87.61
23/10/07 net short 60000 85.27

open interest 1,408,000

commercials reduced shorts by 71000 and reduced longs by 53000 for a reduction in net short of 12000 for the week

To see commercials reducing net shorts at this level of price is very bullish, IMO - looks like oil is going to at least $95 in the short term - probably $100 :)

shane_m
27-10-2007, 08:30 PM
As of last Friday all my stocks are oil producers. Trend is clear, I am only focusing on more oil stocks from now on.

shasta
27-10-2007, 08:49 PM
As of last Friday all my stocks are oil producers. Trend is clear, I am only focusing on more oil stocks from now on.

Just out of interest Shane, what are you holding?

shane_m
28-10-2007, 08:40 PM
Shasta

PETSEC ENERGY LIMITED (PSA)
AMADEUS ENERGY LIMITED (AMU)
STRIKE OIL LIMITED (STX)
PRYME OIL & GAS LIMITED (PYM)

and WPL, should have got in to this one when sniper indicated few years back, with company production set to 3X in 2012, I got in at 40.

was in NZO from 85x, just waiting for oil spill sorted out for re entry.

shasta
28-10-2007, 09:02 PM
Shasta

PETSEC ENERGY LIMITED (PSA)
AMADEUS ENERGY LIMITED (AMU)
STRIKE OIL LIMITED (STX)
PRYME OIL & GAS LIMITED (PYM)

and WPL, should have got in to this one when sniper indicated few years back, with company production set to 3X in 2012, I got in at 40.

was in NZO from 85x, just waiting for oil spill sorted out for re entry.

Nice work, am looking at AMU, BOW, IPM plus a return to NWE & STX.

Am holding NZO, OEL & PSA & fast becoming a goldbug...

Blackgold that is!

Seems whilst GOLD ticks over nicely, BLACKGOLD is kicking & screaming!

Am looking to add more mid tier O&G producers into the mix :cool:

shane_m
01-11-2007, 10:35 AM
Oil soars to touch $95 a barrel

Hawke
01-11-2007, 08:01 PM
Fux- Oil is over $95 on the Nymex!

PPP is pumping hard. Nice.

Hawke.

bermuda
01-11-2007, 10:31 PM
www.energybulletin.net
peak Oil
29 October
Kenneth Deffeyes

Hey we just have to get this message across.

We have an "early Peak Oil Situation"

I have watched this for so many years and now it is unfolding before me.

It's early days yet but this will take a bit of understanding.

Mick100
03-11-2007, 09:22 PM
[quote=Mick100;170570][quote=Mick100;169708][quote=Mick100;167752][quote=Mick100;166946]Commercial (hedgers) net shorts positions

price open interest
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26
16/10/07 net short 78000 87.61
23/10/07 net short 60000 85.27 1,408,000
30/10/07 net short 77400 90.38 1,448,000

commercials added 34400 short and added 16700 long positions for an increase in net shorts of 17400 for the week

My arbitrary line, for net shorts indicating price is close to peaking, is at 90,000 to 95,000 range - it could go quite a bit higher than this of course, and probably will

If the price stays in the high 90s early next week I think the net short position will go over 90,000 next weekend

bermuda
03-11-2007, 10:40 PM
am pretty glad are overweight in oil @ about 65% of portfolio

M

Am 94% in oil...6% in PRC. (why else with oil in huge demand )
We have an early peak oil situations on our hands. And it is all coming out now..left right and centre. Even the CEO of Total admitted it.

We have all been following this story and now it is all starting to happen.

See energybulletin.net Kenneth Deffreyes Oct 29 Feedbacks Loops


Please read this. It is a brilliant prognosis

shasta
03-11-2007, 10:53 PM
Am 94% in oil...6% in PRC. (why else with oil in huge demand )
We have an early peak oil situations on our hands. And it is all coming out now..left right and centre. Even the CEO of Total admitted it.

We have all been following this story and now it is all starting to happen.

See energybulletin.net Kenneth Deffreyes Oct 29 Feedbacks Loops


Please read this. It is a brilliant prognosis

Thanks for the link to that article Bermuda, very interesting read...

Am 60 - 65% in O&G myself & looking to add to it...

$US100/bbl is coming & we all better get used to it!

Mick100
10-11-2007, 02:06 PM
[quote=Mick100;171491][quote=Mick100;170570][quote=Mick100;169708][quote=Mick100;167752][quote=Mick100;166946]Commercial (hedgers) net shorts positions

price open interest
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26
16/10/07 net short 78000 87.61
23/10/07 net short 60000 85.27 1,408,000
30/10/07 net short 77400 90.38 1,448,000
06/11/07 net short 84000 96.70 1,513,000

commercials added 52200 short and 45500 long for an increase in net shorts of 6700 for the week - a small increase in net shorts relative to the increase in the price which was up $6.32 for the week

Look's like we are going to push through $100 - probably next week :)
.

Huang Chung
10-11-2007, 06:01 PM
Does anyone else get the feeling that it doesn't matter whether oil is at $70 or $100, the share prices of mid-sized oilers such as ARQ and BPT just don't seem to move ahead...:confused:

macduffy
10-11-2007, 06:28 PM
Yes, totally mystifying and frustrating.
Makes me wonder if this is a sign that the great bull has run his course? (Except for BHP/RIO of course!)

Disc: Hold ARC/BPT - and other oilers.

Huang Chung
10-11-2007, 07:12 PM
Seems that you either need decades of reserves (e.g. Woodside) or a major oil discovery relative to the company's size (e.g. Innamancka / AED) to get rerated.

I'm not sure if the ARQs and BPTs will continue to miss out on any rerating, or whether it will happen down the track, presumably when they release their half yearly's.

yogi-in-oz
12-11-2007, 02:18 AM
:)

Hi HC,

Aside from field sizes, there's another distinct (and important) difference between
the bigger players, like WPL and the smaller producers ... and smaller producers,
like ARQ and BPT for example .....

..... that difference is in the marketing of their products ... Woodside is more
attuned to INTERNATIONAL oil and gas EXPORT prices, whereas ARQ and BPT
have a limited domestic market to sell into ... hence, they receive only what
local refineries and markets are willing to pay for their oil and gas.

This is especially so for ARQ and EGO, who are trucking oil, south to Kwinana
refinery .....

..... some producers may also be locked into a fixed percentage of the
world oil price, while others may have sold their oil/gas forward, at fixed
prices to secure loans, in the early development of their fields.

So, we cannot take it for granted, that high international oil'gas prices
are being directly reflected here, in their totality ..... :)

happy days

paul

:)

=====

Huang Chung
12-11-2007, 09:30 AM
Some very interesting points you make Paul.....

If this is the case, it doesn't seem to be factored into people's thinking on this forum. It would be interesting to get the view points of some our more distinguished oil followers on S/T.

Mick100
12-11-2007, 10:28 AM
Some very interesting points you make Paul.....

If this is the case, it doesn't seem to be factored into people's thinking on this forum. It would be interesting to get the view points of some our more distinguished oil followers on S/T.

Not sure if I'm a "distinguished oil follower" but yes - I am aware that small producers do not neccessarily command the full world price for their oil

As I understand, refiners have to "fine tune" their plants for the oil of each different oil feild so the oil from large fields commands a higher price than a comparible oil from a small feild, ie less fine tuning if you can do longer runs on the same crude oil.

I was at the NZO meeting recently where managment said they had supplied crude to 2 or 3 different refiners to establish which refiner valued the oil the most - each paid a different price for the crude.

What it comes down to is that crude oil can vary from one feild to another and there are also differences between refineries - many refiners in the world today cannot process heavy sour crude at all and even the light crudes are valued differently by different refiners. In saying that , prices paid to small producers, although may be less than world price, will still be relative to world price, ie, still benifiting from higher oil prices
.

Mick100
18-11-2007, 08:53 PM
[quote=Mick100;172436][quote=Mick100;171491][quote=Mick100;170570][quote=Mick100;169708][quote=Mick100;167752][quote=Mick100;166946]Commercial (hedgers) net shorts positions

price open interest
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26
16/10/07 net short 78000 87.61
23/10/07 net short 60000 85.27 1,408,000
30/10/07 net short 77400 90.38 1,448,000
06/11/07 net short 84000 96.70 1,513,000
13/11/07 net short 23000 91.17 1,445.000

commercials reduced shorts by 46300 and added 14700 longs leading to a reduction in net short of 61000 for the week

Mainsteam media would have you believe that the rising oil price is being driven by speculators - the COT report proves otherwise.
The oil price is being driven by the commercials who are certainly not speculators - they are buying on behalf of refineries.

Buckle your seatbelts - looks like we are heading for a supply crunch - peak oil is here

The oil price will smash $100 soon and it won't stop there either.
My only concern now is that the price goes too high too quickly and sets off a global reccession, ie, be careful what you wish for
,

shasta
18-11-2007, 09:14 PM
[quote=Mick100;172436][quote=Mick100;171491][quote=Mick100;170570][quote=Mick100;169708][quote=Mick100;167752][quote=Mick100;166946]Commercial (hedgers) net shorts positions

price open interest
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26
16/10/07 net short 78000 87.61
23/10/07 net short 60000 85.27 1,408,000
30/10/07 net short 77400 90.38 1,448,000
06/11/07 net short 84000 96.70 1,513,000
13/11/07 net short 23000 91.17 1,445.000

commercials reduced shorts by 46300 and added 14700 longs leading to a reduction in net short of 61000 for the week

Mainsteam media would have you believe that the rising oil price is being driven by speculators - the COT report proves otherwise.
The oil price is being driven by the commercials who are certainly not speculators - they are buying on behalf of refineries.

Buckle your seatbelts - looks like we are heading for a supply crunch - peak oil is here

The oil price will smash $100 soon and it won't stop there either.
My only concern now is that the price goes too high too quickly and sets off a global reccession, ie, be careful what you wish for
,

Sell your cars, buy oil stocks & bike to work, that what you mean? :D

cantab
18-11-2007, 09:32 PM
An oilman on CNBC last week said the problem is "the low hanging fruit" has gone, another oilman said "$50 oil" has gone. One of the oilmen mentioned new technology available such as horizontal drilling that can get extra oil out. (IPM are trying this)

Interestingly a few commentators on CNBC from NY were saying a good way of benefiting from high oil is to buy alternative energy stocks such as solar however one commentator thought US solar stocks were overpriced.

Another way would be investing in rare earths and perhaps Lithium to power hybrid/plug in vehicles. (my own thoughts)

shane_m
19-11-2007, 09:22 AM
If OPEC starts selling oil in Euro US dollar going to free fall. Russia and Iran has already indicated that they are going to do similar.

bermuda
19-11-2007, 11:31 AM
Saudi Arabia has a real battle on its hands to keep oil in $US.

This is only the beginning. Iran, Russia and Venezuela are going to do their own thing.

Goodbye $US. It is all over. Sorry Mr Bush. You and Greenspan have been living the American dream for far too long. Time to wake up to reality.

53 page report on ww.petrodollarwarfare.com is a long but very interesting tale by William Cohen. Report dated 15 January 2007.

bermuda
19-11-2007, 01:44 PM
Saudi Arabia has a real battle on its hands to keep oil in $US.

This is only the beginning. Iran, Russia and Venezuela are going to do their own thing.

Goodbye $US. It is all over. Sorry Mr Bush. You and Greenspan have been living the American dream for far too long. Time to wake up to reality.

53 page report on ww.petrodollarwarfare.com is a long but very interesting tale by William Clark. Report dated 15 January 2007.

I wonder what Bush's next move is?

ronthepom
19-11-2007, 01:49 PM
I wonder what Bush's next move is?

Its not far from Iraq to Iran is it ?

bermuda
19-11-2007, 03:46 PM
Its not far from Iraq to Iran is it ?

His ego is so big he would probably try it.What a yanker.

boysy
19-11-2007, 04:03 PM
Do people honestly think Bush will attack iran he wouldnt dare. imagine what his advisers are telling him about the affordability of oil now just imagine what attaking iran would do to that scenario. Bush may want to attack iran but honestly all he could do is bomb iran and what would that achieve not even bush is stupid enough to attack iran with current oil prices and instability in the region.

shasta
19-11-2007, 06:02 PM
Do people honestly think Bush will attack iran he wouldnt dare. imagine what his advisers are telling him about the affordability of oil now just imagine what attaking iran would do to that scenario. Bush may want to attack iran but honestly all he could do is bomb iran and what would that achieve not even bush is stupid enough to attack iran with current oil prices and instability in the region.

You're giving ol GWB far too much credit, he probably is stupid enough to do it.:eek:

Of course he'll be clutching the flag of the USA, hand on heart & calling them (Iranians) terrorists & reminding the people of 9/11 etc etc.

Just make sure you have your quota of oil stocks when it happens...

bermuda
19-11-2007, 06:23 PM
Do people honestly think Bush will attack iran he wouldnt dare. imagine what his advisers are telling him about the affordability of oil now just imagine what attaking iran would do to that scenario. Bush may want to attack iran but honestly all he could do is bomb iran and what would that achieve not even bush is stupid enough to attack iran with current oil prices and instability in the region.

Boysy

I hope your right mate. Man, this guy is unbelievable. He gets away with murder.

airedale
19-11-2007, 08:09 PM
This should be on Mick's commodity thread, but I will post it here as well.
I have been reading the National Geographic Magazine for June 2004. There is an article on the price of oil. They have looked at the oil input in to US farming. There is a picture of a beef cow, and beside the cow is a stack of 44 gallon or 200 litre drums full of oil. To raise the cow to market stage takes five drums of oil, about 1,000 litres for everything from fertilizers to tractor fuel.
A pound of beef takes 3/4 of a gallon of oil to produce.
And that was three and a half years ago.

shane_m
19-11-2007, 11:25 PM
Iranian President Mahmoud Ahmadinejad has suggested an end to the trading of oil in US dollars, calling the currency "a worthless piece of paper".

http://news.bbc.co.uk/2/hi/americas/7101050.stm

Mick100
04-12-2007, 12:42 AM
[quote=Mick100;173455][quote=Mick100;172436][quote=Mick100;171491][quote=Mick100;170570][quote=Mick100;169708][quote=Mick100;167752][quote=Mick100;166946]Commercial (hedgers) net shorts positions

price open interest
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26
16/10/07 net short 78000 87.61
23/10/07 net short 60000 85.27 1,408,000
30/10/07 net short 77400 90.38 1,448,000
06/11/07 net short 84000 96.70 1,513,000
13/11/07 net short 23000 91.17 1,445.000
20/11/07 net short 29000 95.00 1,398,000
27/11/07 net short 54000 94.42 1,494,400

commercials added 34000 short and added 8500 long for an increase in net short of 25500

Looks like crude is taking a breather here
I don't believe this run up in the crude price is over yet
Next week's COT report will tell the story -

Mick100
16-12-2007, 10:58 AM
[quote=Mick100;175583][quote=Mick100;173455][quote=Mick100;172436][quote=Mick100;171491][quote=Mick100;170570][quote=Mick100;169708][quote=Mick100;167752][quote=Mick100;166946]Commercial (hedgers) net shorts positions

price open interest
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26
16/10/07 net short 78000 87.61
23/10/07 net short 60000 85.27 1,408,000
30/10/07 net short 77400 90.38 1,448,000
06/11/07 net short 84000 96.70 1,513,000
13/11/07 net short 23000 91.17 1,445.000
20/11/07 net short 29000 95.00 1,398,000
27/11/07 net short 54000 94.42 1,494,400
04/12/07 net short 45000 88.32 1.382,500
11/12/07 net short 38000 90.02 1.381,000

oil still in this high level consolidation pattern
With commercial net shorts declining again it look's likely that oil will break to the upside rather than the downside of this consolidation

Global inventories are declining (not just US)
Can OPEC increase output?
A while back they said they were going to increase output by 500,00 bbls per day. In actual fact, OPEC output has fallen by 180,000 bbls per day since october

bermuda
16-12-2007, 06:28 PM
Interesting eh?

My bet is that the Saudi's are going flat out just to maintain production.

They have spent billions in the last 2 years securing every rig they can get their hands on.

Reason: Their established oil fields are in decline.

Q.E.D

Mick100
06-01-2008, 09:32 PM
[quote=Mick100;177108][quote=Mick100;175583][quote=Mick100;173455][quote=Mick100;172436][quote=Mick100;171491][quote=Mick100;170570][quote=Mick100;169708][quote=Mick100;167752][quote=Mick100;166946]Commercial (hedgers) net shorts positions

price open interest
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26
16/10/07 net short 78000 87.61
23/10/07 net short 60000 85.27 1,408,000
30/10/07 net short 77400 90.38 1,448,000
06/11/07 net short 84000 96.70 1,513,000
13/11/07 net short 23000 91.17 1,445.000
20/11/07 net short 29000 95.00 1,398,000
27/11/07 net short 54000 94.42 1,494,400
04/12/07 net short 45000 88.32 1.382,500
11/12/07 net short 38000 90.02 1.381,000
18/12/07 netshort 29125 90,08 1,330,250
24/12/07 net short 51000 94.13 1,326.000
31/12/07 net short 85100 95.98 1,361 000

net shorts increased significantly over the last two weeks
Looking less likely to break through 100 and stay above that level now

Might have to wait until the summer driving season to see a susained break above $100 - that's assuming there is not a severe reccession in the US. A mild reccession in the US will not lead to a drop off in global demand IMO.

digger
06-01-2008, 09:50 PM
Mike100
Do you have access to the accuracy of past NET SHORTS .It is easy to see the theory of why oil should rise if net shorts decrease ,but over many years how accurate is this ??

Mick100
07-01-2008, 12:34 AM
Mike100
Do you have access to the accuracy of past NET SHORTS .It is easy to see the theory of why oil should rise if net shorts decrease ,but over many years how accurate is this ??

I don't have much in the way of data myself but others such as larry williams have decades of data to back up this approach to futures trading

I'v read a few books explaining the different methods of people operating in the futures markets and Larry Williams is the only author who made any sense to me. The only system that I can relate to is to watch the industry insiders (the commercials) If you don't believe that industry insiders know more than the other traders/speculators in a given market then net commercial positions are meaningless to you

The commercials are not in the market to make a profit - they are there to hedge their future production or future buying requirements. At the moment there appear to be plenty of oil producers happy to sell their oil at 95 to 100. If they expected oil to go to 125 next month they wouldn't be selling at 95 today

I use the COT reports as a short/medium term leading indicator to get some idea of the short term price movements - long term I'm bullish on oil

digger
07-01-2008, 06:55 AM
Thanks for the quick reply Mick 100. Apperciated. Will look up this Larry Williams book.Better still anyone got the book they would now want to sell? Heavens knows i have had more than a few books on last house move ended up chucking out when other could have used them.

STRAT
07-01-2008, 09:20 AM
I wonder what Bush's next move is?To retire and go down in history as the most shameful President yet, a lier, a twit and the man who in two terms in office managed to get more people to hate America than any other in history.

airedale
22-01-2008, 09:36 PM
Subject: Fw: [Garfield on the oil crisis]

My American cousin keeps me informed.:D











Garfield on the oil crisis




http://www.sharetrader.co.nz/cid:000f01c85b86$094cea00$2f01a8c0@your4dacd0ea75




A lot of folks can't understand how we came




To have an oil shortage here in our country.




~~~




Well, there's a very simple answer.




~~~




Nobody bothered to check the oil.




~~~




We just didn't know we were getting low.




~~~




The reason for that is purely geographical.




~~~




Our OIL is located in




~~~




Alaska




~~~




California




~~~




Coastal Florida




~~~




Coastal Louisiana




~~~




Kansas




~~~




Oklahoma




~~~




Pennsylvania




And




Texas




~~~




Our




DIPSTICKS




Are located in




Washington , DC !!!




Any Questions ???




NO? I didn't Think So.




































http://www.sharetrader.co.nz/cid:{96F41F48-A799-4BAB-A59C-1DCC4F3263C6}/ATT00009.jpg

Mick100
27-01-2008, 09:52 PM
[quote=Mick100;179432][quote=Mick100;177108][quote=Mick100;175583][quote=Mick100;173455][quote=Mick100;172436][quote=Mick100;171491][quote=Mick100;170570][quote=Mick100;169708][quote=Mick100;167752][quote=Mick100;166946]Commercial (hedgers) net shorts positions

price open interest
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26
16/10/07 net short 78000 87.61
23/10/07 net short 60000 85.27 1,408,000
30/10/07 net short 77400 90.38 1,448,000
06/11/07 net short 84000 96.70 1,513,000
13/11/07 net short 23000 91.17 1,445.000
20/11/07 net short 29000 95.00 1,398,000
27/11/07 net short 54000 94.42 1,494,400
04/12/07 net short 45000 88.32 1.382,500
11/12/07 net short 38000 90.02 1.381,000
18/12/07 netshort 29125 90,08 1,330,250
24/12/07 net short 51000 94.13 1,326.000
31/12/07 net short 85100 95.98 1,361 000
08/01/08 net short 100500 96.33 1,414,000
15/01/08 net short 91000 91.90 1.458.000
22/01/08 net short 38400 89.21 1,343,200
.

Hoags
28-01-2008, 08:50 AM
Hi Mick,

What is your source for this info?

Cheers - Hoags

Mick100
28-01-2008, 10:42 AM
COT reports at
www.cftc.gov (http://www.cftc.gov)

or more direct link
http://www.cftc.gov/marketreports/commitmentsoftraders/index.htm


light sweet oil is traded on the new york mercantile exchange

Hoags
28-01-2008, 11:03 AM
Great Cheers

Mick100
04-03-2008, 11:00 AM
[quote=Mick100;182880][quote=Mick100;179432][quote=Mick100;177108][quote=Mick100;175583][quote=Mick100;173455][quote=Mick100;172436][quote=Mick100;171491][quote=Mick100;170570][quote=Mick100;169708][quote=Mick100;167752][quote=Mick100;166946]Commercial (hedgers) net shorts positions

price open interest
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26
16/10/07 net short 78000 87.61
23/10/07 net short 60000 85.27 1,408,000
30/10/07 net short 77400 90.38 1,448,000
06/11/07 net short 84000 96.70 1,513,000
13/11/07 net short 23000 91.17 1,445.000
20/11/07 net short 29000 95.00 1,398,000
27/11/07 net short 54000 94.42 1,494,400
04/12/07 net short 45000 88.32 1.382,500
11/12/07 net short 38000 90.02 1.381,000
18/12/07 netshort 29125 90,08 1,330,250
24/12/07 net short 51000 94.13 1,326.000
31/12/07 net short 85100 95.98 1,361 000
08/01/08 net short 100500 96.33 1,414,000
15/01/08 net short 91000 91.90 1.458.000
22/01/08 net short 38400 89.21 1,343,200
29/01/07 net short 31000 91.64 1,366,000
05/02/07 net short 25000 88.41 1,368,500
12/02/07 net short 36900 92.78 1,393,000
19/02/07 net short 54200 99.70 1,355.000
26/02/07 net short 85800 100.88 1,406.000

arco
12-03-2008, 01:05 PM
In March of 2005, Goldman Sachs kicked off the oil speculation boom by releasing a report that "Oil Could Spike to $105. (http://www.energybulletin.net/5017.html)"
At the time oil was around $55 a barrel, already up considerably from $25 a barrel before the Iraq war (the second one) surprisingly caused oil prices to spike.
[Interesting note: The first Iraq war is what made our current President his first millions as he sold his stock the same month his dad invaded Iraq and spiked oil from $18 a barrel in July 1990 to $27 in August (http://www.economagic.com/em-cgi/data.exe/var/west-texas-crude-long). After bankrupting his first company (aptly called Arbusto Energy), in which he was partners with Salem Bin Laden (http://www.bushwatch.com/binladens.htm) (Osama’s Father) through James Bath (who also worked with BCCI who conducted the largest bank fraud in US history while laundering gun money for George I in the 80s), Junior merged Arbusto with Spectrum 7, became the CEO and bankrupted them. Spectrum 7 was then sold to Harken with the financial help of BCCI’s Kalid bin Mahfouz, who took over for Bin Laden on his death and bought 17% of Harken in exchange for the Bush bail-out which ended up giving him 400,000 shares of Harken stock (http://www.thetruthaboutgeorge.com/special/harken.html) (Bush was investigated by the SEC but was cleared - how would he know his dad was going to invade Iraq?!?)...]
Anyway, so there was no way our President could have foreseen the impact that invading Iraq (again) would have on the American economy (or his family’s extensive oil holdings) but Goldman Sachs was on top of the situation as they were the largest trader of energy derivatives. Goldman’s 2005 report cited " Thin spare capacity in the energy supply chain, and long response times for bringing on supply additions, as well as robust demand in the United States and in developing heavyweights China and India, despite the recent rapid increase in energy costs."
Now that the mission has been accomplished at $105, Goldman (who has made record income on the massive increase in energy prices and energy trading even while losing their shirts on the other bubble, housing) has now upped the anti and is boosting their low-end range to $80 and says: "$200 a barrel could be a reality in the not-too-distant future in the case of a "major disruption"."
This report (http://www.smartmoney.com/bn/ON/index.cfm?story=ON-20080307-000988-1530), released Monday morning by the same guy who was right about $105 (even though he said that would be a super-spike, not the norm), drove oil to $108 a barrel in Monday’s trading and knocked the markets right off their early morning recovery and sent them back towards the 1/22 lows.
What Goldman doesn’t explain though, is who is going to pay for this $200 a barrel oil? I pointed out to members of my site Monday afternoon that today’s $2 rise in oil prices will cost US consumers $280M next week. At 20M barrels a day of consumption, $200 a barrel oil would be $4Bn a day spent just on oil! That’s about $1Bn a day more than we’re paying now, $365Bn a year or double what Bush is dumping into the economy in order to shut us all up while oil goes over $105 a barrel while the dollar "super spikes" below 73.
http://static.seekingalpha.com/uploads/2008/3/11/thumb_480_chart_us_dollar.gif (http://static.seekingalpha.com/uploads/2008/3/11/chart_us_dollar.gif)
That’s right, our own US dollar finished the day today at an all-time low of 72.96, down 40% since Jan 2002 so the joke is on OPEC, who is only getting $60 worth of our 2002 currency for their $100 barrels of oil. Unfortunately, the joke is also on us as that dollar you have in your pocket is worth just 60 cents while the average American is making LESS money than he did in 2002.



http://seekingalpha.com/article/68016-200-oil-who-s-going-to-pay-for-it?source=side_bar_editors_picks

bermuda
13-03-2008, 09:03 AM
In March of 2005, Goldman Sachs kicked off the oil speculation boom by releasing a report that "Oil Could Spike to $105. (http://www.energybulletin.net/5017.html)"
At the time oil was around $55 a barrel, already up considerably from $25 a barrel before the Iraq war (the second one) surprisingly caused oil prices to spike.
[Interesting note: The first Iraq war is what made our current President his first millions as he sold his stock the same month his dad invaded Iraq and spiked oil from $18 a barrel in July 1990 to $27 in August (http://www.economagic.com/em-cgi/data.exe/var/west-texas-crude-long). After bankrupting his first company (aptly called Arbusto Energy), in which he was partners with Salem Bin Laden (http://www.bushwatch.com/binladens.htm) (Osama’s Father) through James Bath (who also worked with BCCI who conducted the largest bank fraud in US history while laundering gun money for George I in the 80s), Junior merged Arbusto with Spectrum 7, became the CEO and bankrupted them. Spectrum 7 was then sold to Harken with the financial help of BCCI’s Kalid bin Mahfouz, who took over for Bin Laden on his death and bought 17% of Harken in exchange for the Bush bail-out which ended up giving him 400,000 shares of Harken stock (http://www.thetruthaboutgeorge.com/special/harken.html) (Bush was investigated by the SEC but was cleared - how would he know his dad was going to invade Iraq?!?)...]
Anyway, so there was no way our President could have foreseen the impact that invading Iraq (again) would have on the American economy (or his family’s extensive oil holdings) but Goldman Sachs was on top of the situation as they were the largest trader of energy derivatives. Goldman’s 2005 report cited " Thin spare capacity in the energy supply chain, and long response times for bringing on supply additions, as well as robust demand in the United States and in developing heavyweights China and India, despite the recent rapid increase in energy costs."
Now that the mission has been accomplished at $105, Goldman (who has made record income on the massive increase in energy prices and energy trading even while losing their shirts on the other bubble, housing) has now upped the anti and is boosting their low-end range to $80 and says: "$200 a barrel could be a reality in the not-too-distant future in the case of a "major disruption"."
This report (http://www.smartmoney.com/bn/ON/index.cfm?story=ON-20080307-000988-1530), released Monday morning by the same guy who was right about $105 (even though he said that would be a super-spike, not the norm), drove oil to $108 a barrel in Monday’s trading and knocked the markets right off their early morning recovery and sent them back towards the 1/22 lows.
What Goldman doesn’t explain though, is who is going to pay for this $200 a barrel oil? I pointed out to members of my site Monday afternoon that today’s $2 rise in oil prices will cost US consumers $280M next week. At 20M barrels a day of consumption, $200 a barrel oil would be $4Bn a day spent just on oil! That’s about $1Bn a day more than we’re paying now, $365Bn a year or double what Bush is dumping into the economy in order to shut us all up while oil goes over $105 a barrel while the dollar "super spikes" below 73.
http://static.seekingalpha.com/uploads/2008/3/11/thumb_480_chart_us_dollar.gif (http://static.seekingalpha.com/uploads/2008/3/11/chart_us_dollar.gif)
That’s right, our own US dollar finished the day today at an all-time low of 72.96, down 40% since Jan 2002 so the joke is on OPEC, who is only getting $60 worth of our 2002 currency for their $100 barrels of oil. Unfortunately, the joke is also on us as that dollar you have in your pocket is worth just 60 cents while the average American is making LESS money than he did in 2002.



http://seekingalpha.com/article/68016-200-oil-who-s-going-to-pay-for-it?source=side_bar_editors_picks

In 2006 the NZ Petroleum conference opened with an address by a very smooth aussie Westpac senior ECONOMIST who forecast a drop in commodity prices. Classic supply and demand theory.

Two years later the lessons have not been learnt. Another Westpac senior ECONOMIST gave the opening address and talked again of a drop in commodities especially oil. Classic supply and demand theory.

When will these guys realise that oil is A PRECIOUS FINITE RESOURCE!!

Huang Chung
14-03-2008, 06:57 PM
Below is a link to the keynote address given by Beach Petroleum MD Reg Nelson at the VictoriaPower & Gas 2008 conference this week.

Whilst it obviously focuses in part on Beach's endeavours, I'd say that all of you O&G junkies will find the address very interesting, as the scope of the address is wider than just Beach.:rolleyes:

Recommended weekend reading.

Enjoy.

http://www.beachpetroleum.com.au/files/reports/asx_releases/2008/027-08Keynote_address_Vic_Power_Gas_.pdf

Mick100
15-03-2008, 07:52 PM
[quote=Mick100;188159][quote=Mick100;182880][quote=Mick100;179432][quote=Mick100;177108][quote=Mick100;175583][quote=Mick100;173455][quote=Mick100;172436][quote=Mick100;171491][quote=Mick100;170570][quote=Mick100;169708][quote=Mick100;167752][quote=Mick100;166946]Commercial (hedgers) net shorts positions

price open interest
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26
16/10/07 net short 78000 87.61
23/10/07 net short 60000 85.27 1,408,000
30/10/07 net short 77400 90.38 1,448,000
06/11/07 net short 84000 96.70 1,513,000
13/11/07 net short 23000 91.17 1,445.000
20/11/07 net short 29000 95.00 1,398,000
27/11/07 net short 54000 94.42 1,494,400
04/12/07 net short 45000 88.32 1.382,500
11/12/07 net short 38000 90.02 1.381,000
18/12/07 netshort 29125 90,08 1,330,250
24/12/07 net short 51000 94.13 1,326.000
31/12/07 net short 85100 95.98 1,361 000
08/01/08 net short 100500 96.33 1,414,000
15/01/08 net short 91000 91.90 1.458.000
22/01/08 net short 38400 89.21 1,343,200
29/01/07 net short 31000 91.64 1,366,000
05/02/07 net short 25000 88.41 1,368,500
12/02/07 net short 36900 92.78 1,393,000
19/02/07 net short 54200 99.70 1,355.000
26/02/07 net short 85800 100.88 1,406.000
04/03/08 net short 102,800 99.52 1,451.000
11/03/07 net short 97230 108.75 1,484 400
18/03/08 net short 70200 108.50 1,407,400
25/03/08 net short 52100 101.22 1,362,700
01/04/08 net short 40100 100.98 1,382.000
08/04/08 net short 49500 108.50 1,412,300
15/04/08 net short 47600 113.79 1,441,400
22/04/08 net short 40500 118.07 1,337.100
29/04/08 net short 37300 115.63 1,365,500
06/05/08 net short 24100 121.84 1,422,400
.

Mick100
19-04-2008, 09:30 PM
net shorts not increasing along with the price - very bullish

should easily make $120 on this run in price
,

Mick100
10-05-2008, 08:20 PM
net shorts decreasing on strong price increases
This is extremely bullish
Do the commercials sense a shortage in the near future?
usually they are big sellers on big price increases - not this time

fill up your car and your jerry cans next week or better still, buy some oil shares as a hedge

Dr_Who
11-05-2008, 09:05 AM
net shorts decreasing on strong price increases
This is extremely bullish
Do the commercials sense a shortage in the near future?
usually they are big sellers on big price increases - not this time

fill up your car and your jerry cans next week or better still, buy some oil shares as a hedge

Thanks for the reports and numbers Mick. :)

I am all set in oilers and miners. The funny thing is that all my friends who are well educated and in high positions dont believe in Peak Oil. Either the population dont want to believe it or something is not right. Maybe it will take oil to be at $150 for everyone to take notice.

It is a great feeling to wake up and enjoy the oil price increase while everyone else complains about it.. LOL

Peak oil is here to stay, get used to it.

temptation
11-05-2008, 02:42 PM
Doctor Doctor,
Whilst I do believe we are near Peak oil, and my portfolio is prepared for it, I believe that the consequences are dire. Consumption of oil can only be constrained by the world economy going into an unprecedented recession.

macduffy
11-05-2008, 05:51 PM
I reckon the strongest argument that oil production is at its peak, or very near to it, lies in the price.
If the price of any other product or commodity had increased at the rate that oil has, producers would be falling over each other in a race to meet the demand. I know that oil refineries take years to build, etc, etc but the fact that oil production doesn't step up says to me that it just can't!

Financially dependant
13-05-2008, 10:29 AM
A balanced article!

http://www.sharecafe.com.au/fnarena_news.asp?a=AV&ai=8548

COLIN
13-05-2008, 10:57 AM
A balanced article!

http://www.sharecafe.com.au/fnarena_news.asp?a=AV&ai=8548

So I had to read through all that to get to the final sentence: "Where is the oil price headed? I have absolutely no idea!"

An informative read, nevertheless. At the end of the day we all have to make up our own minds - or keep them open!

Dr_Who
13-05-2008, 10:59 AM
Good article.

If you have a look at the graph of OPEC production and oil price, you come to the conclusion that OPEC is pumping out oil at max levels, yet oil prices continues to go higher.

Dr_Who
14-05-2008, 10:14 AM
Iran has now switched their oil trade to $EU and reducing oil output... ROFL! This will really pee off GW Bush. What a laugh.

Comments by BHP CEO points to clear evidence that Oil will stay high for this year and possible evidence of PEAK OIL.

BHP tips good oil on energy

http://www.news.com.au/heraldsun/story/0,21985,23693858-664,00.html

bermuda
15-05-2008, 04:56 PM
So I had to read through all that to get to the final sentence: "Where is the oil price headed? I have absolutely no idea!"

An informative read, nevertheless. At the end of the day we all have to make up our own minds - or keep them open!


Oil goes higher....much higher.

Mick100
24-05-2008, 10:38 PM
[quote=Mick100;189896][quote=Mick100;188159][quote=Mick100;182880][quote=Mick100;179432][quote=Mick100;177108][quote=Mick100;175583][quote=Mick100;173455][quote=Mick100;172436][quote=Mick100;171491][quote=Mick100;170570][quote=Mick100;169708][quote=Mick100;167752][quote=Mick100;166946]Commercial (hedgers) net shorts positions

price open interest
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26
16/10/07 net short 78000 87.61
23/10/07 net short 60000 85.27 1,408,000
30/10/07 net short 77400 90.38 1,448,000
06/11/07 net short 84000 96.70 1,513,000
13/11/07 net short 23000 91.17 1,445.000
20/11/07 net short 29000 95.00 1,398,000
27/11/07 net short 54000 94.42 1,494,400
04/12/07 net short 45000 88.32 1.382,500
11/12/07 net short 38000 90.02 1.381,000
18/12/07 netshort 29125 90,08 1,330,250
24/12/07 net short 51000 94.13 1,326.000
31/12/07 net short 85100 95.98 1,361 000
08/01/08 net short 100500 96.33 1,414,000
15/01/08 net short 91000 91.90 1.458.000
22/01/08 net short 38400 89.21 1,343,200
29/01/07 net short 31000 91.64 1,366,000
05/02/07 net short 25000 88.41 1,368,500
12/02/07 net short 36900 92.78 1,393,000
19/02/07 net short 54200 99.70 1,355.000
26/02/07 net short 85800 100.88 1,406.000
04/03/08 net short 102,800 99.52 1,451.000
11/03/07 net short 97230 108.75 1,484 400
18/03/08 net short 70200 108.50 1,407,400
25/03/08 net short 52100 101.22 1,362,700
01/04/08 net short 40100 100.98 1,382.000
08/04/08 net short 49500 108.50 1,412,300
15/04/08 net short 47600 113.79 1,441,400
22/04/08 net short 40500 118.07 1,337.100
29/04/08 net short 37300 115.63 1,365,500
06/05/08 net short 24100 121.84 1,422,400
13/05/08 net short 39300 123.10 1,477,000
20/05/08 net short 19400 128.98 1,356,700

Mick100
24-05-2008, 10:44 PM
nets shorts at their lowest number since I'v been keeping records (mid last yr)
oil prices are going higher - probably, much higher

the machine
25-05-2008, 11:33 AM
nets shorts at their lowest number since I'v been keeping records (mid last yr)
oil prices are going higher - probably, much higher


mick, can you please elaborate a bit on what the data means - thanks

M

SEC
25-05-2008, 10:13 PM
nets shorts at their lowest number since I'v been keeping records (mid last yr)
oil prices are going higher - probably, much higher

Another way to read this is that those who were shorting oil hard when it hit $100 got it wrong, very wrong and had to cover, pushing the oil price even higher.

So short covering may be contributing to the current oil price as well as speculators. Both point to a short term spike.

SEC

Mick100
25-05-2008, 10:53 PM
mick, can you please elaborate a bit on what the data means - thanks

M

COT (commitment of traders) report

CRUDE OIL, LIGHT SWEET - NEW YORK MERCANTILE EXCHANGE Code-067651
FUTURES ONLY POSITIONS AS OF 05/20/08 |
--------------------------------------------------------------| NONREPORTABLE
NON-COMMERCIAL | COMMERCIAL | TOTAL | POSITIONS
--------------------------|-----------------|-----------------|-----------------
LONG | SHORT |SPREADS | LONG | SHORT | LONG | SHORT | LONG | SHORT
--------------------------------------------------------------------------------

243,548 193,318 202,940 827,582 847,025 1274070 1243283 82,587 113,374

CHANGES FROM 05/13/08 (CHANGE IN OPEN INTEREST: -120,350)
-19,830 1,707 -25,280 -76,982 -96,911 -122,092 -120,484 1,742 134

PERCENT OF OPEN INTEREST FOR EACH CATEGORY OF TRADERS
18.0 14.2 15.0 61.0 62.4 93.9 91.6 6.1 8.4

NUMBER OF TRADERS IN EACH CATEGORY (TOTAL TRADERS: 334)
95 123 131 84 99 267 276


I'll point out the relevant info

non commercial (large traders/speculators)
long 243,548
short 193,318
spreads 202,940 (a spread is both a long and a short combined)

commercials (hedgers)
long 827,580
short 847.025
(hedgers are either buying or selling - spreads are of no use to them)

totals
long 1,274,070
short 1,243,283
===========================

large traders (non commercials) have a net long position of 50,230 contracts
hedgers (commercials) have a net short position of 19,445

============================

those reports or figures which I have been quoting weekly are only for the commercials (hedgers). I'm not interested in what the non commercials (large traders ) are doing because they are just momentum players who buy when prices are going up and sell when prices are going down.

The commercials, on the other hand, are the people who actually produce/sell physical oil and use/buy physical oil. These people are industry insiders and I am assuming that these people understand best the factors affecting the supply and demand for oil.

you may find it strange that I am so bullish on oil while the commercials are net sellers, ie, they have more contracts to sell oil than to buy. There's a good explanation for this pecularity which applies to nearly all commodities most of the time
If you put yourself into the position of a producer - you know what your costs of production are - you know what the spot price is for your oil - by selling foward (futures) you are able to lock in your profit and provide certainty of income, thus reducing risk. So when spot prices are well in excess of production costs it's tempting for poducers to hedge future production in the futures market. If the spot price goes higher you lose out on some potential profit but your not going to go broke - you have locked in a good profit margin

now put yourself in the position of a buyer of oil
the risks of hedging are quite different to the buyer
If he locks in todays price in the futures market he may make good money if the price keeps increasing while he's locked in a lower buying price and can sell at the market price as with petrol. But what if the price goes down after he's locked in todays price. His unhedged competitors are able to lower their prices as their input prices fall. In short, our hedged buyer goes broke. So for the buyer to hedge is actually quite risky .

Add to this the fact that producers are price takers - they accept the market price - they cannot pass on cost increases to the customer. On the other hand
fuel retailors are price setters - they can pass on higher costs (of oil) to the consumer

to cut a long story short, the incentive to hedge are much stronger for the producer than for the buyers of oil - this is why commercials are nearly always net sellers (net short)

Huang Chung
25-05-2008, 10:58 PM
Another way to read this is that those who were shorting oil hard when it hit $100 got it wrong, very wrong and had to cover, pushing the oil price even higher.

So short covering may be contributing to the current oil price as well as speculators. Both point to a short term spike.

SEC

Anton Tagliaferro from Investors Mutual was saying on Inside Business this morning that the rapid movement in the oild price is not just a supply / demand issue (which counters Boon Pickin's recent commentary).

Extract from Inside Business:

ALAN KOHLER: The stockmarket is up about 15 per cent from it's lows in mid March. Are you just happy or are you worried or a bit of both?

ANTON TAGLIAFERRO: Look it's always a relief when the market goes up and I think that's what it's been, it's been a relief rally, you know.
Many of the issues that were around that caused the correction in the first place, you know, they haven't gone away.
Clearly the bail out of Bear Sterns gave some confidence in financial markets that further, you know financial institutions won't fall over.
But clearly, you know, the housing market in the US continues to fall away.
You know, the higher commodity prices aren't helping in terms of helping the consumer, helping economic growth going forward. So we think it's going to be pretty choppy, you know.
And again if you look at the corporate earnings outlook going forward, the resource sector aside, which by the way, I think a lot of the commodity prices are being buoyed by huge speculative buying, there's no doubt about it when you see the oil price moving four dollars in one night, that's not a supply demand adjustment, and then falling two the next.
You know, that's obviously some large speculative funds in there.

the machine
26-05-2008, 12:56 AM
mick100 - thanks for the elaboration

regards

M

Mick100
31-05-2008, 01:21 PM
[quote=Mick100;202234][quote=Mick100;189896][quote=Mick100;188159][quote=Mick100;182880][quote=Mick100;179432][quote=Mick100;177108][quote=Mick100;175583][quote=Mick100;173455][quote=Mick100;172436][quote=Mick100;171491][quote=Mick100;170570][quote=Mick100;169708][quote=Mick100;167752][quote=Mick100;166946]Commercial (hedgers) net shorts positions

price open interest
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26
16/10/07 net short 78000 87.61
23/10/07 net short 60000 85.27 1,408,000
30/10/07 net short 77400 90.38 1,448,000
06/11/07 net short 84000 96.70 1,513,000
13/11/07 net short 23000 91.17 1,445.000
20/11/07 net short 29000 95.00 1,398,000
27/11/07 net short 54000 94.42 1,494,400
04/12/07 net short 45000 88.32 1.382,500
11/12/07 net short 38000 90.02 1.381,000
18/12/07 netshort 29125 90,08 1,330,250
24/12/07 net short 51000 94.13 1,326.000
31/12/07 net short 85100 95.98 1,361 000
08/01/08 net short 100500 96.33 1,414,000
15/01/08 net short 91000 91.90 1.458.000
22/01/08 net short 38400 89.21 1,343,200
29/01/07 net short 31000 91.64 1,366,000
05/02/07 net short 25000 88.41 1,368,500
12/02/07 net short 36900 92.78 1,393,000
19/02/07 net short 54200 99.70 1,355.000
26/02/07 net short 85800 100.88 1,406.000
04/03/08 net short 102,800 99.52 1,451.000
11/03/07 net short 97230 108.75 1,484 400
18/03/08 net short 70200 108.50 1,407,400
25/03/08 net short 52100 101.22 1,362,700
01/04/08 net short 40100 100.98 1,382.000
08/04/08 net short 49500 108.50 1,412,300
15/04/08 net short 47600 113.79 1,441,400
22/04/08 net short 40500 118.07 1,337.100
29/04/08 net short 37300 115.63 1,365,500
06/05/08 net short 24100 121.84 1,422,400
13/05/08 net short 39300 123.10 1,477,000
20/05/08 net short 19400 128.98 1,356,700
27/05/08 net short 11170 128.85 1,338.900
03/06/08 net short 19660 124.31 1,355,600
10/06/08 net short 13930 131.31 1.418,750

Mick100
31-05-2008, 01:28 PM
net shorts still falling while price increasing - extremely bullish

forget about what the speculators are doing - commercials are sensing a coming shortage

looking for an explosive move to the upside in coming weeks

Financially dependant
01-06-2008, 09:35 AM
Another nice short video on current oil situation.

http://finance.yahoo.com/tech-ticker/article/22662/Reports-of-Oil-Boom's-Death-Look-Premature?tickers=OIL,USO,DOW,JCG,ROH,DUG

stolen from T.O.D

Mick100
15-06-2008, 11:02 PM
net shorts still at very low levels

oil should continue moving higher

upside_umop
16-06-2008, 07:19 AM
hey mick,

this 'net shorts,' is this stating the obvious that more people are holding short positions on oil than long?

Packersoldkidney
17-06-2008, 10:50 PM
I expect oil to be trading at $75 a barrell by the end of next year. That is the very top of the range I expect to be trading in. To me, the technical signs are mixed - however failure to breach $140 would be a short term bearish sign - however in this bubble phase any upwards price is possible.

The number of oil contracts traded has increased 20 fold since when oil was $58 a barrell - yet the demand for oil has basically remained static during that time - and now oil is over US $130 a barrell.

In other words, a huge amount of the increase in the price of oil is down to speculation.

Oil traded at US $40 a barrell in 1980 - in 1986 it traded at US $6 a barrell. I expect a fall in the price of oil of similar magnitude in coming years.

jonathan76
17-06-2008, 11:44 PM
I expect oil to be trading at $75 a barrell by the end of next year. That is the very top of the range I expect to be trading in. To me, the technical signs are mixed - however failure to breach $140 would be a short term bearish sign - however in this bubble phase any upwards price is possible.

The number of oil contracts traded has increased 20 fold since when oil was $58 a barrell - yet the demand for oil has basically remained static during that time - and now oil is over US $130 a barrell.

In other words, a huge amount of the increase in the price of oil is down to speculation.

Oil traded at US $40 a barrell in 1980 - in 1986 it traded at US $6 a barrell. I expect a fall in the price of oil of similar magnitude in coming years.
I disagree, "statistics showed sales of motor vehicles of all types hit a record 1.68 million units in China, up by 600,000, or 58.8&#37;, compared with a year ago. Meanwhile, car output also jumped 51.5% to 1.75 million units for the first four months. Strong sales boosted auto makers' profits. According to the NDRC, the auto industry's profits in the first quarter of this year soared 87.4% from a year before to reach 15.3 billion yuan. "

http://www.atimes.com/atimes/China_Business/HE18Cb05.html

above is only one of many statistics showing the demand of car in china alone outstrip the supply of petrol worldwide every week. What saudi arabia has decided to increase production by 500000 barrels a day will easily be outstrip by china's car production in a month or two.

The main problem is the cars are made cheaply by local car manufacturers in china that build cheap petrol hungry cars

Packersoldkidney
18-06-2008, 02:34 AM
I disagree, "statistics showed sales of motor vehicles of all types hit a record 1.68 million units in China, up by 600,000, or 58.8%, compared with a year ago. Meanwhile, car output also jumped 51.5% to 1.75 million units for the first four months. Strong sales boosted auto makers' profits. According to the NDRC, the auto industry's profits in the first quarter of this year soared 87.4% from a year before to reach 15.3 billion yuan. "

http://www.atimes.com/atimes/China_Business/HE18Cb05.html

above is only one of many statistics showing the demand of car in china alone outstrip the supply of petrol worldwide every week. What saudi arabia has decided to increase production by 500000 barrels a day will easily be outstrip by china's car production in a month or two.

The main problem is the cars are made cheaply by local car manufacturers in china that build cheap petrol hungry cars

The percentage use of oil used in motor cars is really quite fractional compared to its other uses, at least in parts of the world apart from North America - China is also cutting back its subsidies for oil, as are other parts of Asia: oil is just too expensive to subsidise.

The Chinese may well be producing a lot of cars, but a global recession will quickly knock that on the head and send the majority of them back to rickshaws.

I think oil, when you discount what is obviously now a bubble in the commodity, will continue to rise in the long term - I just think that at the moment oil is well over-done and due a fairly nasty correction. You can point to fundamentals, but fundamentals are an erroneous way to look at things at this point in the cycle - it is obvious the price of oil has become completely detached to the underlying economics of the situation. Demand just hasn't increased all that much recently - and is basically the same it was when oil was under $60 US a barrell - let alone what the current price is doing to demand (ie, softening it).

There are always 'fundamental' reasons why a bubble can keep on getting bigger - there was with tech stocks back in 2000, with housing in 2004/5, and probably with the tulip mania back in 1637. Every bubble provides reasons why it can keep on expanding. History, however, should tell you something different. Every cycle has its boom phase, and then it has its bust phase.

Skol
18-06-2008, 06:45 AM
There are always 'fundamental' reasons why a bubble can keep on getting bigger - there was with tech stocks back in 2000, with housing in 2004/5, and probably with the tulip mania back in 1637. Every bubble provides reasons why it can keep on expanding. History, however, should tell you something different. Every cycle has its boom phase, and then it has its bust phase.


As J.M. Keynes said: "Markets can stay irrational longer than you can stay solvent".

Financially dependant
18-06-2008, 09:07 AM
It is good to see healthy debate on oil, as it deserves it!

Two issues I would like to bring up to add to the debate which I don't think have not been mentioned, one is the extra S.A. oil promised to come on stream is heavy sour oil, we already have plenty of it which the refiners do not want (not set up to handle, or to costly handle it).

The other issue is ELM (export land model), most of the increase in consumption is from oil exporting nations (Middle east, Venezuela, Nigeria et al) so there is less hitting international markets all the time.

There no doubt will be a peak of the price of oil and then it will drop away (not sure a bursting bubble analogy works for me) because of competition, but there is no alternative at the moment and will not be an alternative for some time.

bermuda
18-06-2008, 09:32 AM
"Every market has its bust phase"

And oil will have its bust phase when the world has developed sufficient alternatives.....

At the moment we are 5-10 years away from that time.

What happens until then is very scary. And some of this is being played out now.

So start conserving now.Everyone.

Dr_Who
18-06-2008, 10:02 AM
The Chinese may well be producing a lot of cars, but a global recession will quickly knock that on the head and send the majority of them back to rickshaws.



Thats a pretty arrogant statement to make about the Chinese. China and India is currently holding up the global economy. In another 10-20 years China will take over America to be the largest economy in the world. India and China's infrastructure needs huge amount of upgrading and will require huge amount of resources to develop.

Unlike other oil bubbles in the past, this time round there is a fundamental demand coming from booming economies in Asia to sustain growth. The world is still in denial that there is a supply and demand problem. This is evident with American not addressing the fundamental problems they are having which is their huge appetite for oil. Instead of reducing consumption for oil, they are doing a witch hunt and pointing the fingers at others.

There will come a time for the oil price to peak and knows one knows when, unless you have a crystal ball. I say oil price will not come below $100 unless China has a market crash or a viable alternative to oil is discovered. In the meantime, investors like us are having a ball making great capital gains in the energy market.

Packersoldkidney
18-06-2008, 11:16 AM
Thats a pretty arrogant statement to make about the Chinese. China and India is currently holding up the global economy. In another 10-20 years China will take over America to be the largest economy in the world. India and China's infrastructure needs huge amount of upgrading and will require huge amount of resources to develop.

Unlike other oil bubbles in the past, this time round there is a fundamental demand coming from booming economies in Asia to sustain growth. The world is still in denial that there is a supply and demand problem. This is evident with American not addressing the fundamental problems they are having which is their huge appetite for oil. Instead of reducing consumption for oil, they are doing a witch hunt and pointing the fingers at others.

There will come a time for the oil price to peak and knows one knows when, unless you have a crystal ball. I say oil price will not come below $100 unless China has a market crash or a viable alternative to oil is discovered. In the meantime, investors like us are having a ball making great capital gains in the energy market.


My statement was half tongue-in-cheek.

Anyway, everyone here seems to be bullish on oil, which to me is as good a contrarian indicator as any.

Packersoldkidney
18-06-2008, 11:19 AM
As J.M. Keynes said: "Markets can stay irrational longer than you can stay solvent".

That's a fair statement, and I agree oil *could* go much higher from here - markets can be very irrational at times - but the underlying supply/demand situation is now disconnected. That should be obvious when oil rises $10 in one day.

Financially dependant
18-06-2008, 12:44 PM
A little off topic but it gives an idea of what China is up to.

jonathan76
19-06-2008, 03:10 AM
Another thought to put into the conversation.

I say the oil price will keeps going for a at least 5-10 years while the alternatives are being look at because of my personal experiences.

Every few years, I visit my relatives in china, every few years, the amount of spending money my relatives throw at luxuries and also car increase by 10 times or even more. The problem in China is that the population suddenly became middle class and rich with money to pour away like water. To them, petrol price is nothing as when their income increase ten times each year, the petrol cost only increase 1 time. That's also the reason why all my relatives change vehicle each year and each year the car is bigger and more petrol consuming.

We cannot compare the exploding market in china to other countries. In Australia, unless you work in the mine, your salary is peg to inflation and maybe you get 4.2&#37; pay increment next year, in china, you get 1000% pay increment each year easily both through your employer and through bribery. One of my relative is a public servant who earns miserable pay but he bought two apartments worth $300k AUD in the past year alone and he spent AUD$200 each meal or at least when I visit him over the two weeks that I spent at his house. That's how rich the chinese are. Petrol price increases? He don't even know the prices increase at the petrol pump station!!!

Financially dependant
19-06-2008, 08:05 AM
Another thought to put into the conversation.

I say the oil price will keeps going for a at least 5-10 years while the alternatives are being look at because of my personal experiences.

Every few years, I visit my relatives in china, every few years, the amount of spending money my relatives throw at luxuries and also car increase by 10 times or even more. The problem in China is that the population suddenly became middle class and rich with money to pour away like water. To them, petrol price is nothing as when their income increase ten times each year, the petrol cost only increase 1 time. That's also the reason why all my relatives change vehicle each year and each year the car is bigger and more petrol consuming.

We cannot compare the exploding market in china to other countries. In Australia, unless you work in the mine, your salary is peg to inflation and maybe you get 4.2% pay increment next year, in china, you get 1000% pay increment each year easily both through your employer and through bribery. One of my relative is a public servant who earns miserable pay but he bought two apartments worth $300k AUD in the past year alone and he spent AUD$200 each meal or at least when I visit him over the two weeks that I spent at his house. That's how rich the chinese are. Petrol price increases? He don't even know the prices increase at the petrol pump station!!!

Wow, thats interesting.

The official inflation rate is steady but the bribery and black market inflation rate is going through the roof!

Mick100
22-06-2008, 03:39 PM
[quote=Mick100;203502][quote=Mick100;202234][quote=Mick100;189896][quote=Mick100;188159][quote=Mick100;182880][quote=Mick100;179432][quote=Mick100;177108][quote=Mick100;175583][quote=Mick100;173455][quote=Mick100;172436][quote=Mick100;171491][quote=Mick100;170570][quote=Mick100;169708][quote=Mick100;167752][quote=Mick100;166946]Commercial (hedgers) net shorts positions

price open interest
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50
2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26
16/10/07 net short 78000 87.61
23/10/07 net short 60000 85.27 1,408,000
30/10/07 net short 77400 90.38 1,448,000
06/11/07 net short 84000 96.70 1,513,000
13/11/07 net short 23000 91.17 1,445.000
20/11/07 net short 29000 95.00 1,398,000
27/11/07 net short 54000 94.42 1,494,400
04/12/07 net short 45000 88.32 1.382,500
11/12/07 net short 38000 90.02 1.381,000
18/12/07 netshort 29125 90,08 1,330,250
24/12/07 net short 51000 94.13 1,326.000
31/12/07 net short 85100 95.98 1,361 000
08/01/08 net short 100500 96.33 1,414,000
15/01/08 net short 91000 91.90 1.458.000
22/01/08 net short 38400 89.21 1,343,200
29/01/07 net short 31000 91.64 1,366,000
05/02/07 net short 25000 88.41 1,368,500
12/02/07 net short 36900 92.78 1,393,000
19/02/07 net short 54200 99.70 1,355.000
26/02/07 net short 85800 100.88 1,406.000
04/03/08 net short 102,800 99.52 1,451.000
11/03/07 net short 97230 108.75 1,484 400
18/03/08 net short 70200 108.50 1,407,400
25/03/08 net short 52100 101.22 1,362,700
01/04/08 net short 40100 100.98 1,382.000
08/04/08 net short 49500 108.50 1,412,300
15/04/08 net short 47600 113.79 1,441,400
22/04/08 net short 40500 118.07 1,337.100
29/04/08 net short 37300 115.63 1,365,500
06/05/08 net short 24100 121.84 1,422,400
13/05/08 net short 39300 123.10 1,477,000
20/05/08 net short 19400 128.98 1,356,700
27/05/08 net short 11170 128.85 1,338.900
03/06/08 net short 19660 124.31 1,355,600
10/06/08 net short 13930 131.31 1.418,750
17/06/08 net long 1900 134.01 1,335,200
24/06/08 net long 4650 137.00 1,306.100